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Your financial firm needs to borrow $500 million by selling time deposit with 180-day maturities. If interest rates on comparable deposit are currently at 3.5%,
Your financial firm needs to borrow $500 million by selling time deposit with 180-day maturities. If interest rates on comparable deposit are currently at 3.5%, what is the cost of issuing these deposit? Suppose interest rate rise to 4.5%. What then will be the cost of these deposit? What position and types of futures contract could be used to deal with this cost increase
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