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Business, 19.11.2019 22:31 hella33revj

For the following problem(s), consider these debt strategies being considered by a corporate borrower. each is intended to provide $1,000,000 in financing for a three-year period.
strategy #1: borrow $1,000,000 for three years at a fixed rate of interest of 7%.
strategy #2: borrow $1,000,000 for three years at a floating rate of libor + 2%, to be reset annually. the current libor rate is 3.50%.
strategy #3: borrow $1,000,000 for one year at a fixed rate, and then renew the credit annually. the current one-year rate is 5%.
which strategy (strategies) will eliminate credit risk?

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