1 borrowing costs of two companies a and b in the fixed, Ask an Expert

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1. Borrowing costs of two companies, A and B, in the fixed rate and floating rate markets are given below.

Company B is a project and has raised floating-rate funds. It is looking into swapping its floating payment liabilities for fixed rate payment liability to manage its interest rate risk.

Company A has raised fixed rate funds and is looking into converting its fixed rate liabilities into floating rate liability. Show how Companies A and B can achieve their objectives including their ability to lower the funding costs though an interest swaps deal.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91374302

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