Question: explain how ibm can use a forward rate agreement lock in the cost of a one year & 2.5 million loan to be taken out
explain how ibm can use a forward rate agreement lock in the cost of a one year & 2.5 million loan to be taken out in 6 months. Alternatively explain how IBM can loch in the interest rate on this loan by using euro dollar future contacts.what is the major difference between using the HRA & the future contract to hedge IBM'S interest rate risk?
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