Roo-Fus Inc. took out a EUR 19 million loan to finance its expansions in Europe. However, it prefers to make its debt payments in AUD and therefore wants to swap into a fixed-rate AUD loan. Westpac quotes the following annualized rates on 5-year currency swaps:

AUD: 7.64% bid and 7.89% offered against the 6-month dollar LIBOR

EUR: 4.15% bid and 4.37% offered against the 6-month dollar LIBOR

If the current EUR/AUD spot rate is 1.28, what are the semi-annual cash flows associated with the debt payments of a EUR 19m swap? You want to swap out of a EUR 19 mil loan and into a fixed-rate AUD loan, and you can ignore the off-setting LIBOR payments.

Select one:

a. AUD 0.585586 mil payment to Westpac; receive EUR 0.394250 mil payment from Westpac

b. receive AUD 0.585586 mil payment from Westpac; EUR 0.394250 mil payment to Westpac

c. AUD 1.171172 mil payment to Westpac; receive EUR 0.788500 mil payment from Westpac

d. receive AUD 1.171172 mil payment from Westpac; EUR 0.788500 mil payment to Westpac

e. AUD 0.567031 mil payment to Westpac; receive EUR 0.394250 mil payment from Westpac

f. receive AUD 0.567031 mil payment from Westpac; EUR 0.415150 mil payment to Westpac

g. AUD 0.585586 mil payment to Westpac; receive EUR 0.415150 mil payment from Westpac