Question: You borrow 1.000.000 USD with a variable rate of LIBOR+2%. You would have paid 9% if you had borrowed at fixed rate. Which of the

You borrow 1.000.000 USD with a variable rate of LIBOR+2%. You would have paid 9% if you had borrowed at fixed rate. Which of the following swap agreements is suitable for you to enter if you expect rates to increase for the next 3 years? You MUST show your work

Pay LIBOR Receive 6%

Pay 6% Receive LIBOR

Pay 7% Receive LIBOR+2%

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