Firm XYZ is holding a long position in a $20 million interest rate swap that has a remaining life of 15 months. Under the terms of the swap, six-month LIBOR is exchanged for 4% per annum (both rates are compounded semiannually). The risk-free interest rate for all maturities is currently 5% per annum with continuous compounding. The six-month LIBOR rate was 4.5% per annum two months ago. a. Compute the current value of the swap to firm XYZ Code your answer in the box below. Clearly comment your working. Display your final answer by running the section. b. Suggest a reason why XYZ entered into the swap in the first place. Type answer here (14 + 6 = 20 marks)

Answers

Answer 1

a. The value of the swap to firm XYZ is -$23,225.33.

b. This would help to protect the firm against an increase in interest rates.

a. Calculation of the value of the swap to firm XYZ

The value of the swap to firm XYZ can be calculated using the following formula:

Value of Swap = Value of Fixed Leg - Value of Floating Leg

Where Value of Fixed Leg = VFL = (Coupon Rate * Principal * (1 - (1 + r)-n / r))

Value of Floating Leg = VFL = (Interest Rate * Principal * (1 - (1 + r)-n / r))

Where, Coupon Rate = 4% p.a. Principal = $20 million

Interest Rate = LIBOR + Spread, Spread = 0, therefore,

Interest Rate = 4.5% p.a.

Time to Maturity, n = 15 months

Remaining Time to Next Payment = 6 - 2 = 4 months

Therefore, the current six-month LIBOR rate is required to calculate the value of the swap as follows:

Current six-month LIBOR rate = 4.5% * (4/6) + x% * (2/6)x = ((Value of Swap/Principal + (1 - (1 + r)-n / r)) * r) / (1 - (1 + r)-n / r) = 0.0251%

Value of Fixed Leg = VFL = (0.04 * 20,000,000 * (1 - (1 + 0.05/2)-30 / (0.05/2))) = $1,328,816.76

Value of Floating Leg = VFL = (0.0451 * 20,000,000 * (1 - (1 + 0.05/2)-10 / (0.05/2))) = $1,352,042.09

Value of Swap = $1,328,816.76 - $1,352,042.09 = -$23,225.33

Therefore, the value of the swap to firm XYZ is -$23,225.33.

b. Suggest a reason why XYZ entered into the swap in the first place

Firm XYZ might have entered into the swap in the first place to mitigate the risk of a rise in interest rates in the future. By entering into a fixed-for-floating interest rate swap, the firm has fixed its borrowing cost for the duration of the swap at 4%, regardless of the future interest rate changes.

Therefore, this would help to protect the firm against an increase in interest rates.

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Related Questions

the table shows the number of eggs,y,in x cartons.How many eggs are there in 15 cartons

Answers

Answer:

180 eggs

Step-by-step explanation:12x15=180

rita traveled 1,250 miles in the first 3 days of her trip. at this rate, how long will it take her to travel 1,875 miles? how much would it cost

Answers

The number of days took by Rita to travel the distance of 1,875 miles is 4.5 days.

What is termed as unitary method?

We will learn how to calculate the value of such a unit from value of a multiple and thus the value of a multiple from value of a unit using the unitary method.

In general, we first calculate the value of one article from value of a multiple, and then calculate the value of the preferred number of articles from value of one. Typically, this method involves both multiplication and division operations.If we know the cost of one object, we can calculate the cost of many objects besides multiplying the cost of one object by the number of objects.

Now, as per the given question;

The total day taken by Rita to cover 1,250 miles is 3.

Thus,  1250 miles ----> 3 days

Let number of days taken by Rita to cover 1875 miles is 'x'.

So, 1875 miles ----> x

Then, the total distance will be

1875×(3) = 1250x

x = (1875×3)/1250

x = 4.5 days

Therefore, the total time taken by Rita to finish the distance of 1,875 miles is 4.5 days.

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what is 3√1/16 . the sign is square root.​

Answers

should be 3/4 or 0.75

Which statement about the graphs is true? NEED HELP!
Graph A is a valid density curve because the part of the graph from 2 to 6 is below the horizontal axis.
Graph A is not a valid density curve because the part of the graph from 1 to 2 is above the horizontal axis.
Graph B is not a valid density curve because part of the horizontal axis has negative values.
Graph B is a valid density curve because the curve is above the horizontal axis, and the area under the curve is 1.

Which statement about the graphs is true? NEED HELP!Graph A is a valid density curve because the part
Which statement about the graphs is true? NEED HELP!Graph A is a valid density curve because the part

Answers

Answer:

Graph B is a valid density curve because the curve is above the horizontal axis, and the area under the curve is 1.

Step-by-step explanation:

A density curve is a graph that shows probability.

There are a few properties that those curves have:

The curves are normalized, which means that the area inside the curve is always equal to 1  (or the 100% of possibilities).

And the probabilities are always defined with positive numbers between 0 and 1, which means that we can not have a density curve with elements below the horizontal axis.

From this, we can conclude that graph A is not a density curve (but neither of the two given options for graph A are correct, then we can discard these).

Now let's look at graph B.

We can see that all points are above the horizontal axis, so that is good.

Now let's compute the area inside the curve.

We can see two triangles, remember that the area of a triangle of base b and height h is:

A = (b*h)/2

To calculate the base in the image, just take the difference between the rightmost vertex and the left vertex.

The base of the left triangle is b = (-3 - (-5)) = 2, and the height is h = 0.25

Then the area is:

A1 = (2*0.25)/2 = 0.25

The base of the right triangle is b = (3 - (-3)) = 6, and the height is h = 0.25

Then the area of this triangle is:

A2 = (6*0.25)/2 = 0.75

If add these areas, we get:

Total area = A1 + A2 = 0.25 + 0.75 = 1

Total area = 1

So we have an area under the curve equal to 1, which means that graph B is a valid density curve.

And the correct option is then:

Graph B is a valid density curve because the curve is above the horizontal axis, and the area under the curve is 1.

The following data represent the dividend yields (in percent) of a random sample of 26 publicly traded des Complete parts (a) to (c) 0.5 0.8 1.75 0.04 0.18 0.35 3.69 0 0.95 0 0.17 1.83 1.33 0 0.54 1.14 0.41 159 21 2.41 292 3.18 3.03 1.43 0.58 0.13 0 0.19 (a) Compute the five-number summary The five-number summary is 10000 (Round to two decimal places as needed. Use ascending order)

Answers

Based on the data above, The five-number summary is 0.00, 0.17, 0.5, 1.43, 292.00.

The following data represent the dividend yields (in percent) of a random sample of 26 publicly traded des.

The following data represents the dividend yields (in percent) of a random sample of 26 publicly traded des:

0.5 0.8 1.75 0.04 0.18 0.35 3.69 0 0.95 0 0.17 1.83 1.33 0 0.54 1.14 0.41 159 21 2.41 292 3.18 3.03 1.43 0.58 0.13 0 0.19

Here, the five-number summary is given by:

Minimum value = 0.00

First Quartile (Q1) = 0.17

Median (Q2) = 0.5

Third Quartile (Q3) = 1.43

Maximum value = 292.00

Therefore, the five-number summary is 0.00, 0.17, 0.5, 1.43, 292.00.

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What is the value of -2|6x - y| when x = -3 and y = 4?
O-44
O-28
O 28
O 44

Answers

Answer:

-44

Step-by-step explanation:

-2|6 * -3 - 4|

-2|-18-4|

-2|-22|

-2 * 22

-44

Max points i need this for finals

Max points i need this for finals

Answers

Answer:

\(Slope (m) = \frac{y}{x} = \frac{3}{1} =3\)

Step-by-step explanation:

\(Slope (m) = \frac{y}{x} = \frac{3}{1} =3\)

\(0 = arctan(\frac{y}{x}) + 180^o = 251.56505117708^o\)

X = -4 – -2 = -2

Y = 4 – 10 = -6

\(Distance (d) = \sqrt{x^2+y^2}=\sqrt{40} = 6.3245553203368\)

Equation of the line:

y = 3x + 16

When x=0, y = 16

When y=0, x = -5.3333333333333

Barry needs $1,449 for summer camp. Two local clubs will each match what he saves. Barry has 3 months before he leaves for summer camp. How much does Barry need to save on his own each month to have enough for summer camp?

Answers

Answer:

$161 each month

Step-by-step explanation:

We first need to calculate the total that Barry needs to save on his own. Since the two clubs are matching the amount that he saves then we need to divide the final total by 3.

$1,449 / 3 = $483

Barry needs to save a total of $483 in order for the two clubs to match his savings so he can save the $1,449 he needs. Barry has 3 months to save this amount therefore we need to divide this by 3.

$483 / 3 = $161

Finally, we can see that Barry needs to save $161 each month to have enough for summer camp

PLEASE HURRY I NEED HELP!!!!
f(x)=x^2. what is g(x)?

A. g(x)= 3x^2
B. g(x)= (1/3x)^2
C. g(x)= 1/3x^2
D. g(x)= 1/9x^2​

PLEASE HURRY I NEED HELP!!!!f(x)=x^2. what is g(x)?A. g(x)= 3x^2B. g(x)= (1/3x)^2C. g(x)= 1/3x^2D. g(x)=

Answers

Answer:

See Down Here

Step-by-step explanation:

We want to get g(x) given that we know f(x) and the graphs for both functions. We will see that the correct option is D:

g(x) = (x/3)^2

By looking at the graph we can see that f(x) and g(x) are two quadratic functions, and g(x) is just a dilation of f(x).

This means that:

g(x) = A*f(x)

Where A is a real number.

We know that:

f(x) = x^2

And by looking at the graph, we also know that g(3) = 1.

Then we can write:

g(3) = A*f(3) = A*3^2 = 1

Now we can solve this for A:

A*3^2 = 1

A*9 = 1

A = 1/9

Then we have:

g(x) = (1/9)*f(x) = (1/9)*x^2 = (x/3)^2

So the correct option is D.

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A clothes dryer is spinning at a rate of 4.5 rotations/second. How many complete
rotations will the dryer make during 22 minutes?

Answers

The number of complete rotations that the clothe dyer can make within the given amount of time would be = 5,940 rotations.

What is a clothe dryer?

A clothe dryer is defined as the electrical electronic instrument that contains a rotary device which spins at a particular rate per minute.

The spinning rate of the clothe dryer = 4.5/sec

The given time = 22 minutes

But 1 minute = 60 seconds

If 4.5 rotations.= 1 second

.X rotations = 60 seconds

make X rotations the subject of formula;

X rotations = 4.5 × 60 = 270 rotations/ minute.

If 270 rotations = 1 minute

X rotations = 22 minutes

make X rotations the subject of formula;

X rotations = 270 × 22

= 5,940 rotations.

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What is the image of (- 4, 3) after a dilation by a scale factor of 2 centered at the origin?

Answers

Answer: (-8,6)

Step-by-step explanation:

Question: What is the image of (-4,3)(−4,3) after a dilation by a scale factor of 22 centered at the origin?

Dilation: multiply each coordinate

(x,y)\rightarrow (2x,2y)

(x,y)→(2x,2y)

Dilations multiply by scale factor

(\color{red}{-4},\color{blue}{3}) \rightarrow (2\cdot \color{red}{-4},2\cdot \color{blue}{3})=\mathbf{(-8,6)}

(−4,3)→(2⋅−4,2⋅3)=(−8,6)

This was on my delta math so i hope this helps

The image of the point (- 4, 3) after dilation will be (-8,6).

What is dilation?

Dilation is the process of increasing the size of an object while maintaining its shape. Depending on the scale factor, the object's size can be increased or decreased.

The scale factor is defined as the proportion of the new image's size to that of the previous image. decision-making.

Given point is  (-4, 3). The dilation of the point will be calculated as below:-

Dilation:- multiply each coordinate.

(x,y)→(2x,2y)

Dilations multiply by a scale factor

(−4,3)→(2⋅−4,2⋅3)=(−8,6)

Therefore, the image of the point (- 4, 3) after dilation will be (-8,6).

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Derivations (20 marks): For each of the questions in this section provide a derivation. Other methods will receive no credit i. ∃x(Fx & Gx) ⊢ ∃xFx & ∃xGx (5 marks)
ii. ¬ 3x(Px v Qx) ⊢ Vx ¬ Px (5 marks) iii. ¬ Vx(Fx → Gx) v 3xFx (10 marks; Hint: To derive this theorem use RA.)

Answers

¬ Vx(Fx → Gx) v 3xFx ⊢ Fx → Gx [1-5, Modus Ponens]

i. ∃x(Fx & Gx) ⊢ ∃xFx & ∃xGx (5 marks)

Proof:

1. ∃x(Fx & Gx) [Premise]

2. Fx & Gx [∃-Elimination, 1]

3. ∃xFx [∃-Introduction, 2]

4. ∃xGx [∃-Introduction, 2]

5. ∃xFx & ∃xGx [Conjunction Introduction, 3 and 4]

6. ∃x(Fx & Gx) ⊢ ∃xFx & ∃xGx [1-5, Modus Ponens]



ii. ¬ 3x(Px v Qx) ⊢ Vx ¬ Px (5 marks)

Proof:

1. ¬ 3x(Px v Qx) [Premise]

2. ¬ Px v ¬ Qx [DeMorgan’s Law, 1]

3. Vx ¬ Px [∀-Introduction, 2]

4. ¬ 3x(Px v Qx) ⊢ Vx ¬ Px [1-3, Modus Ponens]



iii. ¬ Vx(Fx → Gx) v 3xFx (10 marks; Hint: To derive this theorem use RA.)

Proof:

1. ¬ Vx(Fx → Gx) v 3xFx [Premise]

2. (¬ Vx(Fx → Gx) v 3xFx) → (¬ Vx(Fx → Gx) v Fx) [Implication Introduction]

3. ¬ Vx(Fx → Gx) v Fx [Resolution, 1, 2]

4. (¬ Vx(Fx → Gx) v Fx) → (Fx → Gx) [Implication Introduction]

5. Fx → Gx [Resolution, 3, 4]

6. ¬ Vx(Fx → Gx) v 3xFx ⊢ Fx → Gx [1-5, Modus Ponens]

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Evaluate the expression when m = 4 and n = 6.

(3m−n)^2+4m

Answers

Answer:

yor answer is 52

Step-by-step explanation:

the answer is the number 52

A factory has 112 workers. They have decided to change from an 8-hour working day into a 7-hour working day. How many more employees does the
company need to hire in order to keep the factory running as before?

Answers

The factory need 16 more employees to hire in order to keep the factory running as before.

Time and work:

Given that A factory has 112 workers.

When worker decided to change from an 8-hour working day into a 7-hour working day.

In that case also work is same.

              \(112*8=m*7\\\\m=\frac{112*8}{7} =128\)

Where m is number of worker require after changing working hours.

Number of more employees = 128 - 112 = 16

Hence, The factory need 16 more employees to hire in order to keep the factory running as before.

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Can someone solve plzzz .

Can someone solve plzzz .

Answers

Answer:

you have to use multiplication maybe division and addition

Step-by-step explanation:

need help on this, thanks

need help on this, thanks

Answers

The value of question are 65+\(\underline{115}\)=180, \(11x+\underline{48}=180^o\), \(11x=\underline{132}\) and \(x=\underline{12}\).

In the given question we have to find the value of missing term.

(1) 65+......=180

(2) 11x+.......=180

(3) 11x=.........

(4) x=........

To solve this question we have to use some theorem.

Firstly solving the first question.

As we know that the angle of straight line is 180\(^o.\)

So from the diagram

\(65+z=180^o\)

Subtract 65 on both side

\(65+z-65=180^o-65\)

\(z=115\)

Hence, 65+\(\underline{115}\)=180.

Now finding the value of second question.

Using Alternate Exterior Angles Theorem

According to theorem the angle beside 11x - 17 is 65.

As we know that the angle of straight line is 180\(^o.\)

So  11x-17+65=180\(^o.\)

Simplifying

So \(11x+\underline{48}=180^o\)

Now finding the value of third question.

From the second question answer we get \(11x+{48}=180^o\)

Now solving this equation to find the value of 11x

Subtract 48 on both side

\(11x+{48}-48=180^o-48\)

\(11x=132\)

Hence, \(11x=\underline{132}\)

Now solving the fourth question.

To find the value of fourth question we further simplify the answer of third question.

\(11x=132\)

Divide by 11 on both side

\(\frac{11}{11}x=\frac{132}{11}\)

\(x=12\)

Hence, \(x=\underline{12}\)

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What is the greatest common factor of 24, 40 and 32?
A. 1
B. 2
C. 4
D. 8

Answers

It’s 8 because 24/8 is 3 and 40/8 is 5 and 32/8 is 4 so the answer is 8 YOUR WELCOME

Answer:

your answer is D. 8

Step-by-step explanation:

Select all the angles that would have a cosine ratio of -sr3/2.

A. 510°
B. -5pi/6
C. -11pi/6
D. 120°
E. 19pi/6
F. 390°

Answers

The answer for this question is B!!

what is the product?(9 t minus 4)(negative 9 t minus 4)negative 81 t squared minus 16negative 81 t squared 16negative 81 t squared minus 72 t 16negative 81 t squared 72 t 16

Answers

The product of (9t - 4) and (-9t - 4) is: -81t² -16.What is a product?A product is a mathematical term referring to the outcome of multiplying two or more numbers or expressions.

It is the result when two or more quantities are multiplied. The sign that represents the mathematical function of multiplication is ‘x’. It is important to note that not all mathematical operations can be considered products but all products are results of multiplication. In this case, we are given two expressions, we are to multiply them to find their product.The expressions are (9t - 4) and (-9t - 4).

To find their product, we can use the FOIL method, which is an acronym for multiplying the terms, i.e., First, Outer, Inner, and Last:First: 9t x -9t = -81t²Outer: 9t x -4 = -36tInner: -4 x -9t = 36tLast: -4 x -4 = 16Therefore, the product of (9t - 4) and (-9t - 4) is -81t² - 16.

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the pair of figures to the right are similar. what is the ratio of the perimeters and the ratio of the areas?
the ratio of perimeters is __
the ratio of the areas is __

the pair of figures to the right are similar. what is the ratio of the perimeters and the ratio of the

Answers

Answer:

the ratio of perimeters is 3/5

the ratio of areas is 9/25

Step-by-step explanation:

first we divide the given sides of both figures

perimeter=side 1/side 2

=15/25

p=3/5

to find the ratios of the area

=(side 1/side 2)^2

=(3/5)^2

=9/25

Answer:

the ratio of perimeters is 3/5

the ratio of areas is 9/25

What is the point slope form of a line with a slope of 5 and goes through the
point (1,5)? *

Answers

Answer:

y-5=5(x-1)

Step-by-step explanation:

Point slope form is: y-y1=m(x-x1)

y1 here is 5 and x1 is 1, because those are the points in the ordered pair given.

y-5=x-1 would be your base answer, but you need to account for the slope as well, which is m. So, y-5=5(x-1)

Hope this helped! :)

Answer: y+1=-5(x-2)

Step-by-step explanation:

How many real solutions exist for this system of equations?
A. Zero
B. One
C. Two
D. Infinite

How many real solutions exist for this system of equations?A. ZeroB. OneC. TwoD. Infinite

Answers

A) zero as the value of determinant is imaginary

The number of real solutions of the equations y = x - 3 and y = x² - 6x + 10 will be zero. Then the correct option is A.

What is the solution to the equation?

The allocation of weights to the important variables that produce the calculation's optimum is referred to as a direct consequence.

The equations are given below.

y = x - 3

y = x² - 6x + 10

Compare both equations, then we have

x² - 6x + 10 = x - 3

Simplify the equation, then we have

x² - 7x + 13 = 0

The solution to the equation, then we have

x = [7 ± √(49 - 52)] / 2

x = 7/2 ± (√3/2)i

The number of real solutions of the equations y = x - 3 and y = x² - 6x + 10 will be zero. Then the correct option is A.

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Question 6 options:
The Edwards family spends $800 per month on groceries for their family. If this is 18% of their monthly budget, then what is their monthly budget?

Round to the nearest cent (hundredths place).

Answers

Answer:

Monthly budget = $4444.44

Step-by-step explanation:

Let the monthly budget of Edwards family = x dollars

18% of monthly budget spends on groceries

Hence,

18% of x = 800

\({\dfrac{ 18 }{ 100 } \times x = 800}\)

\(\mathrm{Multiply\:both\:sides\:by\:100\:to\:cancel\:out\:the\:fraction}\)

\(100 \times \dfrac{ 18 }{ 100 } x = 800 \times 100\)

\(\mathrm{Simplify}\)

\(18x = 80000\)

\(\mathrm{Divide\:18\:from\:both\:sides}\)

\(\dfrac{ 18x }{ 18 } = \dfrac{ 80000 }{ 18 }\)

\(x = 4444.444444444\)

Rounded to the nearest cent: $4444.44

PLSSS HELP IF YOU TURLY KNOW THISS

PLSSS HELP IF YOU TURLY KNOW THISS

Answers

Answer:

C

Step-by-step explanation:

6-4=2

3/4-2/4=1/4

if the simple interest on $5000 for 2 years is $700, then what is the interest rate

Answers

Answer: The interest rate is 7%




5000 • 2x = 700
——— ———-
5000 5000

2x = 0.14
— ——-
2 2

x = 0.07 (times two since it’s a percent)

The radius of a sphere is 7 cm. What is the sphere's volume? Round to the nearest tenth, and use 3.14

Answers

Answer:

1436.8 cm3

Step-by-step explanation:

4/3  π r^3 ; r = 7 (substitute)

4/3 π (7)^3 (cube)

4/3 π 21 (reorder)

4/3 (21) π (muptiply)

28 π (multiply)

87.96..... (round)

88cm^3

What percentage of this grid is shaded?
b)
How many more squares need to be shaded
so that 80% of the grid is shaded?

What percentage of this grid is shaded?b)How many more squares need to be shadedso that 80% of the grid

Answers

Answer:

52% of the grid is shaded. You would need 7 more squares in order to get 80%.

Step-by-step explanation:

There are 25 boxes. You want to figure out how much each box is worth.

So,

You divide 100 by 25. You will get an answer of 4.

So now you know how much each box is worth.

There are 13 boxes shaded in, so you multiply 13 by 4 to get 52.

Keep adding boxes in order to get 80%. For example, 52%, 56%, 60%, until you get to 80%. Then see how many boxes you added up to get 80%.

We would need 7 more squares in order to get 80%. Thus, 52% of the grid is shaded.

What is the unitary method?

The unitary method is a method for solving a problem by the first value of a single unit and then finding the value by multiplying the single value.

There are 25 boxes. we want to figure out how much each box is worth.

So,

100 / 25 = 4

Now, we know how much each box is worth.

There are 13 boxes shaded in,

so 13 x 4 = 52.

Keep adding boxes in order to get 80%.

For example, 52%, 56%, 60%.

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What number, when divided by 6, is equivalent to 15?

n=90
n=5/2
n=4
n=15

Answers

Answer:

90

Step-by-step explanation:

15+15=30

3x30=90

What divided by 6 equals 15?

Therefore, the answer to what divided by 6 equals 15 is 90. You can prove this by taking 90 and dividing it by 6, and you will see that the answer is 15. Tip: For future reference, when you are presented with a problem like "What divided by 6 equals 15?", all you have to do is multiply the two known numbers together.

Therefore, n=90 is your correct answer

which of the following give chart elements a realistic, three-dimensional look?A. axisB. chart areaC. legendD. plot area

Answers

The option that gives chart elements a realistic, three-dimensional look is D. Plot Area.

The option that gives chart elements a realistic, three-dimensional look is the plot area. The plot area is the portion of the chart that displays the data points and is typically the main focus of the chart. Adding shading and depth to the plot area, can give the chart a more lifelike appearance and make the data more visually engaging. Additionally, three-dimensional charts can also be created by using specialized charting software that allows for the creation of 3D visualizations. These types of charts can be useful for highlighting patterns and trends in the data, especially when dealing with large datasets.
In a chart, the plot area is the space where the actual data points, bars, lines, or pie slices are displayed. By applying three-dimensional effects to the plot area, you can make the chart elements appear more realistic and visually appealing. This can enhance the viewer's understanding of the data being represented and make the chart more engaging.
In summary, to give chart elements a realistic, three-dimensional look, you should focus on the plot area (Option D). The axis (Option A), chart area (Option B), and legend (Option C) do not directly contribute to creating a three-dimensional appearance for the chart elements.

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3/45 simplified (pls help)

Answers

Answer:

1/15

Step-by-step explanation:

You can divide 3 and 45 by 3, so the simplified fraction wil be 1/15

Answer:

1/15

Step-by-step explanation:

well, 3 is a prime number, so its only factors are 1 and 3

45 is composite, so it has multiple factors, like 9, 5, 3, 15...

Let's find a common factor! which is 3

so divide both numerator and denominator by 3, you get 1/15

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