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Question 2: ABC wants to swap El,000,000 over a 5-year period and agres to make an annual interest payment at the fixed nate of 6.00%.
Question 2: ABC wants to swap El,000,000 over a 5-year period and agres to make an annual interest payment at the fixed nate of 6.00%. ABC agrees to recerve an equivalent dollar amount over the 5-year period at the fixed rate of 4.5%. The exchange rate at the time of the contract is $1.40/E. After the second interest payment was exchanged. ABC wants to exit the swap contract. Using the new exchange mate, how much the NPV of this sertement amount. Interest rate on 3-year cash flows =7% Interest rate on 3 -year 5 cash flows =4% Exchange rate is S1.35/ Question 2: ABC wants to swap El,000,000 over a 5-year period and agres to make an annual interest payment at the fixed nate of 6.00%. ABC agrees to recerve an equivalent dollar amount over the 5-year period at the fixed rate of 4.5%. The exchange rate at the time of the contract is $1.40/E. After the second interest payment was exchanged. ABC wants to exit the swap contract. Using the new exchange mate, how much the NPV of this sertement amount. Interest rate on 3-year cash flows =7% Interest rate on 3 -year 5 cash flows =4% Exchange rate is S1.35/
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