Ford has a 5 year $100m fixed rate loan with Citibank at 0.046 (annual rate). Ford now
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Ford has a 5 year $100m fixed rate loan with Citibank at 0.046 (annual rate). Ford now thinks rates will go lower and calls Goldman Sachs for a swap and receives a quote of 0.029 / 0.030 (annual rate) against 6m LIBOR flat and executes the swap. Assume at the next rate reset, 6m LIBOR is 0.016 (annual rate). What is Ford's net effective annual interest rate for that rate reset in decimal terms to three decimal places?
Related Book For
Modern Advanced Accounting in Canada
ISBN: 978-1259087554
8th edition
Authors: Hilton Murray, Herauf Darrell
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