rates per annum on a S 10 million 10-year loan: Floating Rate Funding Cost 7 Companies X and Y have been offered the following Fixed Rate Funding Cost LIBOR+0.5% LIBOR+1.5 % Company X Company Y 7,0% 8.8% Company X requires a floating rate loan; company Y requires a fixed rate loan. If X and Y agree to a swap that X will pay LIOBOR floating in exchange for Y pay 7.4% fixed rate. (A) How much is available for arbitrage? (B) What much the cost savings will be to each of X and Y with the swap? (8 points)