Here are the rates offered to companies $x$ and $Y.$

Fixed Floating

Company X $10\%$ LIBOR $+1\mathrm{.}5\%$

Company Y $12\%$ LIBOR $+2\%$

$x$ wishes to borrow at a floating rate and $Y$ wishes to borrow at a fixed rate.

Let us assume that there is no financial intermediary so that $x$ and $Y$ directly sign a swap contract.

Can $x$ and $Y$ enter into a plain vanilla interest rate swap contract in which the benefits of $x$ and $Y$ are equal?

No$.$ Swap agreement does not make sense to both $x$ and $Y.$

No$.$ Swap agreement would only be beneficial to $x.$

Yes. Swap agreement can be equally beneficial to both parties.

No$.$ Swap agreement would only be beneficial to Y$.$