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Scenario: Suppose Investment Bank 1 decides to underwrite a 12,000,000, 20 year, 6.45% semi-annual bond issue for Company A on a firm commitment basis. Investment

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Scenario: Suppose Investment Bank 1 decides to underwrite a 12,000,000, 20 year, 6.45% semi-annual bond issue for Company A on a firm commitment basis. Investment Bank 1 pays Company A today, and they plan to issue the bonds tomorrow. If the interest rate is 35 basis points higher tomorrow, then how will this impact Investment Bank 1's profit? O Investment Bank 1 will lose $452,949.80. Investment Bank 1 will lose $573.195.16. Investment Bank 1 will lose $455,496.36. Investment Bank 1 will gain $7.938,650.83

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