Suppose that IBM would like to borrow fixed$-$rate yen, whereas Korea Development Bank $($KDB$)$ would like to borrow floating$-$rate dollars. IBM can borrow fixed$-$rate yen at $4\mathrm{.}5\%$ or floating$-$rate dollars at LIBOR $+0\mathrm{.}25\%.$ KDB can borrow fixed$-$rate yen at $4\mathrm{.}9\%$ or floating$-$rate dollars at LIBOR $+0\mathrm{.}8\%.$

a$.$ What is the range of possible cost savings that IBM can realize through an interest rate$/$currency swap with KDB$?$

b$.$ Assuming a notional principal equivalent to $$125$ million and a current exchange rate of $105/$$$,$ what do these possible cost savings translate into in yen terms?

c$.$ Redo parts a and b assuming that the parties use Bank of America, which charges a fee of $8$ basis points to arrange the swap.