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Question 3. Swap Comparative Advantage for Currency Swaps (10%) XXX wants to borrow USD YYY & Co wants to borrow EURO EURO USD XXX YYY

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Question 3. Swap Comparative Advantage for Currency Swaps (10%) XXX wants to borrow USD YYY & Co wants to borrow EURO EURO USD XXX YYY 3,25% 4,75% 6,75% 5.50% Design a swap that will net a bank, acting as intermediary 0.1% (10 basis points) per annum. Make the swap equally attractive to the two companies and ensure that all foreign exchange rate is assumed by the bank

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