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Please use the following information for questions 16,17 , and 18 : 305 BANK and Florida International Bank (FIB) have been offered the following rates per annum on $100 million 10-year nondeposit borrowings: Hint: Note that FIB has an absolute advantage in both markets. However, FIB has a comparative advantage in the short-term market. Therefore, FIB should borrow in short-term market, and 305 BANK should borrow in the long-term market. Compute the interest rate spread between both banks' long-term and short-term borrowing costs. \begin{tabular}{l} 1% \\ 0.5% \\ \hline 0% \\ \hline 0.5% \\ \hline 1% \end{tabular} Question 17 0.1 pts Compute the combined savings for both parties if they would enter into an interest rate swap: $860,000 $1,000,000 $4,000000 $10,000,000 There would be no savings Assuming this gain is split evenly between the parties, what is the effective fixed rate for 305 BANK after entering into the swap transaction? \begin{tabular}{|c|} \hline 2.8% \\ \hline 3.5% \\ \hline 4% \\ \hline 4.2% \\ \hline 5.5% \\ \hline \end{tabular}