Company A has an investment that pays a fixed rate of 5% on a principal of $100 million. It enters into a swap contract with a bank where it pays a fixed rate of 5.015% and receives LIBOR. Which of the following best describes the effective interest earned after the swap is created?

A) LIBOR

B) LIBOR-0.015%

c) 4,985%

D) 5,015%

Answer rating: 100% (QA)

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