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Question 4 (7 points) Suppose a bank buys an interest rate cap that has these terms the cap will last for 5 years; payment is

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Question 4 (7 points) Suppose a bank buys an interest rate cap that has these terms the cap will last for 5 years; payment is annually, the cap rate is 7%; and the notional amount is $10 million. Suppose that at the end of 1-year period the interest rate is 5%, what is the amount of the payment that the bank will receive? Oso $0.2 million 50.7 million 12 50.5 million

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