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Dec 2014 paper task 2 (a)
6y ago
6y ago#1The question says that they can borrow at LIBOR plus 40 basis points (which is 0.40%).
So if LIBOR is 4.3% then they will pay 4.3 + 0.4 = 4.7%. If LIBOR is 3.3% then they will pay 3.3 + 0.4 = 3.7%.
Have you watched my free lectures on interest rate risk management?
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