You took a position in a 6-month horizon Forward Rate Agreement on 6-month SOFR. When you took the position on November 15, 2023, 6-month term SOFR was 5.38% and 12-month term SOFR was 5.24%.

a. According to no-arbitrage principles, what was the fixed rate in this forward rate agreement?

b. Assume you entered as the short (fixed rate receiver/floating rate payer) at the fixed rate that you computed in part a. If 6-month term SOFR is 5.10% at settlement, what is your settlement amount on $10,000,000 of notional principal? When does this settlement take place?