Question
what you mean of date, you mean a deadline? Use the website cmegroup.com for the following: A-What is the implied LIBOR rate based on the
what you mean of date, you mean a deadline?
Use the website cmegroup.com for the following:
A-What is the implied LIBOR rate based on the price of the June 2019 Eurodollar futures contract (under interest rates product label of GE)?_____________
b-Assume you work for a firm that needed to borrow $25,000,000 in June of 2019 and would be paying an interest rate based in LIBOR. If you wanted to hedge your exposure to a change in LIBOR rates how many contracts would you sell?_____________
c-Based on your answer in b, how much margin would you be required to deposit (assuming you are classified as a hedger and only need to deposit the maintenance margin)?_______________
d-If in June of 2019 at the settlement of the contract LIBOR rates end up being 3.25%, what would be the total gain or loss on your position in the contract (assuming you held them until expiration)?______________ (show work below for credit!!!)
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