Refer to the following table. Xanadu Oil Corporation just secured a fixed interest rate loan at 6% and Rex Technologies just secured a loan at LIBOR+1%. Now the two companies are entering into an interest rate swap agreement where Xanadu will make payments to Rex at LIBOR and receive payments at 6.25% fixed rate. If LIBOR rises above after the swap deal, Xanadu would experience a loss in the deal. Xanadu Oil Corporation Rex Technologies BBB AAA Interest Rate Swaps Credit Rating Fixed rate cost of borrowing Floating rate cost of borrowing 6.25% 8% 6% LIBOR +0.5% LIBOR +1.0% 5.25% 7.25% 7% 5%