Question: You enter into a 3-month (assume 90 days) LIBOR based forward rate agreement with a notional of $25mm and fix a rate of 3.25%. 3-Month

You enter into a 3-month (assume 90 days) LIBOR based forward rate agreement with a notional of $25mm and fix a rate of 3.25%. 3-Month LIBOR rates rise to 4.00% at expiration. What is the payoff on the agreement?

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