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Question 33 Consider the borrowing opportunities for the two firms, which are as follows: Fixed Rate Floating Rate Bank A 10% LIBOR Company B Bank

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Question 33 Consider the borrowing opportunities for the two firms, which are as follows: Fixed Rate Floating Rate Bank A 10% LIBOR Company B Bank A will pay LIBOR -0.75%, and B will pay LIBOR + 0.5%. Bank A will pay LIBOR -0.75%, and B will pay 11.50%. Bank A will pay LIBOR - 0.50%, and B will pay 10.80%. Bank A will pay LIBOR%, and B will pay 11.60%. 12.10% LIBOR + 1% 2.86 pts Assume Bank A would like to switch from a fixed rate to floating rate, and Company B would like to switch from a floating rate to fixed rate. How much would A and B pay after the entering the swap contract if the contract will earn the Swap Bank 30bp and save A 50bp and B 30bp

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