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Kramerica Industries is a AAA-rated company that needs to fund a project with an estimated life of 10 years. It can borrow at a fixed

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Kramerica Industries is a AAA-rated company that needs to fund a project with an estimated life of 10 years. It can borrow at a fixed rate of 8.75% or it can borrow at a floating rate of 3-month LIBOR. Vandelay Industries is a BBB-rated company that also needs to borrow for 10 years. It can borrow at a fixed rate of 10.50% or it can borrow at a floating rate of 3-month LIBOR +.25%. Produce a swap quote that reduces the borrowing costs of both Kramerica and Vandelay Industries, and makes a spread for the swap bank, Super Terrific National Bank. Show how much each company saves and how much is made by STNB

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