You work for a hedge fund that invests in fixed$-$income securities$.$ You have decided to go into a swap agreement as you have some interest rate risk you would like to hedge. Specifically, you are concerned that future yields will decrease over the next $2$ years.

A$.$ Which side of the swap would you enter? Fixed or floating? Explain your answer.

B$.$ The terms of the swap are below:

$$ The tenor of the swap is $2$ years.

$$ Interest is repaid every $6$ months.

$$ The face value is $$1,000,000$

$$ The current $6-$month LIBOR rate is $4\mathrm{.}60\%$

$$ The current market yield is $5\mathrm{.}5\%$

What is the swap rate?

C$.$ What is the current value of the swap?