1. Company A and Company B are borrowing USD. One-month Libor is 2.175% p.a., three-month Libor...
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1. Company A and Company B are borrowing USD. One-month Libor is 2.175% p.a., three-month Libor is 2.435% p.a. and six-month Libor is 2.255% p.a. A borrows at a spread of 25 basis points and B borrows at a 57 basis point spread due to the difference in credit rating between the companies. Company A borrows $28M for 183 days and Company B borrows $15.5M for 32 days. Calculate the amount of interest to be paid by A and B. 1. Company A and Company B are borrowing USD. One-month Libor is 2.175% p.a., three-month Libor is 2.435% p.a. and six-month Libor is 2.255% p.a. A borrows at a spread of 25 basis points and B borrows at a 57 basis point spread due to the difference in credit rating between the companies. Company A borrows $28M for 183 days and Company B borrows $15.5M for 32 days. Calculate the amount of interest to be paid by A and B.
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To calculate the amount of interest to be paid by Company A and Company B we need to consider the Li... View the full answer
Related Book For
Introduction To Corporate Finance
ISBN: 9781118300763
3rd Edition
Authors: Laurence Booth, Sean Cleary
Posted Date:
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