QUESTION 1 Company X wants to borrow $10,000,000 floating for 5 years & company Y wants to borrow $10,000,000 fixed for 5 years. Company X and Y fixed rate borrowing costs are 10% and 12% respectively. Company X and Y floating rate borrowing costs are LIBOR and LIBOR plus 1.5% respectively. A swap bank proposes the following interest only swap X will pay the swap bank annual payments on $10,000,000 with the coupon rate of LIBOR -0.15 percent; in exchange the swap bank will pay to company X interest payments on $10,000,000 at a fixed rate of 9.90 percent. Y will pay the swap bank interest payments on $10,000,000 at a fixed rate of 10.30 percent and the swap bank will pay Y annual payments on $10,000,000 with the coupon rate of LIBOR -0.15 percent. Assume yield is 5%, what is the net present value of this swap to the swap bank, to nearest dollar