reduce, reduce d. increase; increase QUESTION 7 4 points Saved Woland National Bank purchases a three-year interest rate cap for a fee of 2 percent of notional principal valued at $50 million, with an interest rate celing of 11 percent and LIBOR as the index representing the market interest rate At the same time, Woland sells a three-year floor (8 percent) for a fee of 1 percent of the $50 million principal Assume that LIBOR is expected to be 3 percent, 12 percent, and 16 percent at the end of each of the next three years, respectively. How much Woland received (or paid) using this strategy? For example, if the net cash flow is 2.5 million dollars, type 2.5 in the box below. reduce, reduce d. increase; increase QUESTION 7 4 points Saved Woland National Bank purchases a three-year interest rate cap for a fee of 2 percent of notional principal valued at $50 million, with an interest rate celing of 11 percent and LIBOR as the index representing the market interest rate At the same time, Woland sells a three-year floor (8 percent) for a fee of 1 percent of the $50 million principal Assume that LIBOR is expected to be 3 percent, 12 percent, and 16 percent at the end of each of the next three years, respectively. How much Woland received (or paid) using this strategy? For example, if the net cash flow is 2.5 million dollars, type 2.5 in the box below