Question: Question 4 1 pts The table below presents the costs of borrowing for Nike and Microsoft in Dollars and Pounds, and the quotes for interest

Question 4 1 pts The table below presents the costs of

Question 4 1 pts The table below presents the costs of borrowing for Nike and Microsoft in Dollars and Pounds, and the quotes for interest swaps in Dollars and Pounds, both quoted against LIBOR. Nike would like to get a fixed rate Pound loan. Microsoft would like to get axed rate Dollar loan. What is the all in cost for Nike if they enter a currency swap agreement? Borrowing Cost in Dollars Borrowing Cost in Pound Nike $12.00% 5.85% Microsoft $13.05% 5.00% Swap Bank Quote USD GBP Bid Ask Bid Ask $12.00% $12.61% 5.00% 5.75% 5.00% None of the alternatives $12.61% 5.75% $12.00%

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