Steelers & Penguins Sports Clubs both seek the lowest financing cost. They face the following rates:

Steelers Penguins Credit Rating A BBB

fixed funds 4.0% 5.5%

floating funds 6 MO Libor 6 MO Libor + 0.50%

If a swap is set up such that any potential savings are divided such that Steelers gain 60% of the possible savings and Penguins gain 40 percent of the savings, what will be the net post swap cost for Steelers?

a.	Libor 0.60%
	b.	4.6%
	c.	Libor + 0%
	d.	3.5%