A swap agreement calls for Rocky Industries to pay interest annually based on a rate of 2%
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A swap agreement calls for Rocky Industries to pay interest annually based on a rate of 2% over the one-year T-bill rate, currently 3%. In return, Rocky Industries receives interest at a rate of 4% on a fixed-rate basis. The notional principal for the swap is $100,000. What is Rocky’s net interest for the year after the agreement?
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Related Book For 
The Economics of Money Banking and Financial Markets
ISBN: 978-0321785701
5th Canadian edition
Authors: Frederic S. Mishkin, Apostolos Serletis
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