Question: Alpha and Beta Companies can borrow for a five - year term at the following rates: Alpha Beta Moody s credit rating Aa Baa Fixed

Alpha and Beta Companies can borrow for a five-year term at the following rates:
Alpha Beta
Moodys credit rating Aa Baa
Fixed-rate borrowing cost 10%12.4%
Floating-rate borrowing cost LIBOR LIBOR +1%
If there is a swap bank involved and earns 20% of the swap's total benefit. Alpha wants to borrow through floating debts and desires 70% of the total benefit from the swap, and Beta takes the rest of the swap benefit. What is the all-in-cost for Beta through the swap? (if your answer is 10.1%, just enter "10.1").

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