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hELP Please Your financial firm needs to borrow $200 million by selling time deposits with 270 day maturities. If interest rates on comparable deposits are
hELP Please
Your financial firm needs to borrow $200 million by selling time deposits with 270 day maturities. If interest rates on comparable deposits are currently at 3%, what is the cost of issuing these deposits? Suppose interest rates decline to 2%. What then will be the cost of these deposits? What position and type of hedge could be used to deal with this cost change? 4.44m,2.96m, long hedge 4.44m,3m, short hedge 6m,4m, long hedge 6m,4m,cds swapStep by Step Solution
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