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Problem 6 Companies X and Y have been offered the following rates per annum on a $50 million 5-year loan: Fixed Ratel Floating Rate Company
Problem 6 Companies X and Y have been offered the following rates per annum on a $50 million 5-year loan: Fixed Ratel Floating Rate Company X 3.00% LIBOR +0.1% Company Y3.80% LIBOR +0.4% Company X requires a floating-rate loan; company Y requires a fixed-rate loan. Design a swap that will net a bank, acting as intermediary, 0.10% per annum and will be equally attractive to X and Y. Draw a graph for your
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