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Business, 24.12.2020 03:30 breena68

Company A can issue floating-rate debt at LIBOR 1% and can issue fixed rate debt at 9%. Company B can issue floating-rate debt at LIBOR 1.5% and can issue fixed-rate debt at 9.4%. Suppose A issues floating-rate debt and B issues fixed-rate debt, after which they engage in the following swap: A will make a fixed 7.95% payment to B, and B will make a floating-rate payment equal to LIBOR to A. What are the resulting combined interest savings of A and B as a result of the swap

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Company A can issue floating-rate debt at LIBOR 1% and can issue fixed rate debt at 9%. Company B ca...
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