Please answer both questions. Thank you.

Question 15 3 pts An interest rate swap between two firms is sensible when: Both companies prefer fixed rates but both borrow at floating rates o One company prefers to borrow in euros and the other prefers to borrow in USD One company prefers a floating rate and the other prefers a fixed rate Both companies have poor credit but can only borrow by swapping credit ratings. Question 16 3 pts A share of the ADR of a Swedish firm represents one share of that firm's stock that is traded on the stock exchange in Stockholm. The share price of the firm was 500 Swedish Kroner on the Stockholm exchange when the U.S. market opens. At that moment, 10 Swedish kroner equals $1. If the price of the ADR opened at $47.50, a risk-free (arbitrage) trade would be: Borrow 500 kroner and buy a share in Stockholm Use cash to buy a share of the ADR Short the ADR, convert the proceeds to kronor and buy the local shares in Stockholm Short the local shares in Stockholm, convert the proceeds to USD and buy the ADR