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PayPal Holdings, Inc. enters into an interest rate swap agreement to hedge against interest rate fluctuations. The notional principal amount of the swap is $50,000,000.

PayPal Holdings, Inc. enters into an interest rate swap agreement to hedge against interest rate fluctuations. The notional principal amount of the swap is $50,000,000. Calculate the annual interest payments if the fixed interest rate is 4% and the floating rate is LIBOR + 0.5%.

Description

Amount

Notional Principal Amount

$50,000,000

Fixed Interest Rate

4%

Floating Rate

LIBOR + 0.5%

Annual Interest Payments


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