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Question 7 1 pts Seattle Sounders US-based corporation, enters into a currency basis swaps with Liverpool, a British Cowany. In which the Initial principal amounts
Question 7 1 pts Seattle Sounders US-based corporation, enters into a currency basis swaps with Liverpool, a British Cowany. In which the Initial principal amounts are $200 million and 100 million. That is At inception, there is an initiat principal exchange in which Seattle Sounders pays Liverpool 200 million and receives 100 millon: - Subsequently teach interest payment date, Seattle Sounders pays Liverpool the GEP-Libor on 100 million and receives the USD Libor on $200 million At maturity, a re-exchange of prinicials occurs in which Seattle Sounders pays Liverpool 100 million in exchange for $200 million Suppose the spot rates $1.55 at the time of entering into the swar. Assume that Seattle Sounders and Liverpoot both credit ratings at this time and can access torch at Libor Nat. Then from a credit perspective Stattle Sounders in cari moto compartilhantver both side me crying the same credits Seattle Sounders als counterparty is that were honderd
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