Question 23 1 pts Which of the following is FALSE? All types of debt instruments are not regularly available for all borrowers. Swaps assist in tailoring financing to the type desired by a particular borrower. At the inception of an interest-only interest rate swap, the equivalent principal amounts are exchanged at the spot rate. The swap market offers price discovery to market participants. The primary reason for a counterparty to use a currency swap is to obtain debt financing in the swapped currency at an interest cost reduction brought about through comparative advantages each counterparty has in its national capital market. As a broker, the swap bank matches counterparties but does not assume any of the risks of the swap. Question 8 1 pts (Interest rate swap problem #1, 4 of 4) Company X wants to borrow $10,000,000 floating for 5 years; Company Ywants to borrow $10,000,000 fixed for 5 years. Their external borrowing opportunities are shown below: Fixed-Rate Credit Rating Floating Rate Borrowing Cost Borrowing Cost Company X AA 10.5% LIBOR Company Y A 12.0% LIBOR+1% Assume a swap bank is quoting five-year dollar interest rate swaps at 10.7-10.8 percent against LIBOR flat, the swap bank would have made a profit of $10,000 $1,000 $100,000 O $0