JTM has $755M in bonds - maturing in 7 years and paying a fixed 3.9% - for the same amount paying a floating rate of the Bloomberg Short Term Bank Yield Index + 1.35%. You are asked to show the cash flows for the fixed and floating scenarios and the net difference each year plus the net overall difference undiscounted and discounted using a 5% discount rate. Show all fixed and floating payments as negative cash flows. Net benefits use the formula: floating payments minus fixed payments. State whether the swap is better or worse in the space provided.

c. Interest Rate Swap c. Interest Rate Swap