On January $1,2021,$ Firm A enters into a $5-$year interest rate swap agreement with Firm B$.$ Under the terms of swap, Firm A agrees to pay a rate of $9\mathrm{.}05\%$ and receives LIBOR, whereas Firm B pays LIBOR and receives $9\%.$ Assume that notional agreed principal is $$100$ million and LIBOR was at $6\mathrm{.}5\%$ on June $30,2021.$

$11$a$.$ Estimate the amount that Firm A pays on the rst payment date. $[0\mathrm{.}5$ Mark$]$

$11$b$.$ Estimate the amount that Firm A receives on the rst payment date. $[0\mathrm{.}5$ Mark$]$

$11$c$.$ Estimate the amount that Firm B pays on the rst payment date. $[0\mathrm{.}5$ Mark$]$

$11$d$.$ Estimate the amount that Firm B receives on the rst payment date. $[0\mathrm{.}5$ Mark$]$

$11$e$.$ DealernegotiatesaswaptransactionwhereFirmAneedstopay$9\mathrm{.}5\%$andreceiveLIBOR.Whereas Firm B needs to pay LIBOR and receive $9\mathrm{.}2\%.$ What is the commission that the dealer is charging in the swap transaction? $[0\mathrm{.}5$ Mark$]$

$11$f$.$ Suppose the swap dealer wants to negotitate a $30-60$ swap deal between Firm C and Firm D where the xed payments are linked to prevailing yield on Treasury instruments. Estimate the payos to Firm C and Firm D assuming they enter into a $5-$year swap agreement.