Question: Please explain. a A company may issue a 5-year floating rate bond at par with a coupon rate of 2 x LIBOR - 3%. The

Please explain. a A company may issue a 5-year floating rate bond Please explain.

a A company may issue a 5-year floating rate bond at par with a coupon rate of 2 x LIBOR - 3%. The swap fixed rate for a 5-year LIBOR swap is 5%. The company would like to issue a fixed coupon rate bond synthetically by issuing the floating rate bond and and taking a position in the swap market. What fixed coupon rate could the company engineer using the floating bond and the swap market? Group of answer choices 5% 4% 75 2% a A company may issue a 5-year floating rate bond at par with a coupon rate of 2 x LIBOR - 3%. The swap fixed rate for a 5-year LIBOR swap is 5%. The company would like to issue a fixed coupon rate bond synthetically by issuing the floating rate bond and and taking a position in the swap market. What fixed coupon rate could the company engineer using the floating bond and the swap market? Group of answer choices 5% 4% 75 2%

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