Lluvia Manufacturing and Paraguas Products both seek funding at the lowest possible cost. Lluvia is the more credit$-$worthy company. It could borrow at LIBOR$+1\%$ or it could borrow fixed at $8\%.$ Paraguas could borrow fixed at $12\%$ or it could borrow floating at LIBOR$+2\%.$

What opportunity set for improvement in rate for Lluvia and Paraguas?

A$)3\%$ savings for both which can be distributed between the two parties.

B$)4\%$ savings for both which can be distributed between the two parties.

C$)5\%$ savings for both which can be distributed between the two parties.

D$)$ None of the above.