ABC International Can Borrow $4,000,000 at LIBOR Plus a Lending

question 37

Multiple Choice

ABC International can borrow $4,000,000 at LIBOR plus a lending margin of .65 percent per annum on a three-month rollover basis from Barclays in London. Three month LIBOR is currently 5.5 percent. Suppose that over the second three-month interval LIBOR falls to 5.0 percent. How much will ABC pay in interest to Barclays over the six-month period for the Eurodollar loan?

• A)$50,000
• B)$100,000
• C)$118,000
• D)$120,000

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Definitions:

Emotional Labour

Emotional labour refers to the process of managing one's feelings and expressions based on the emotional requirements of a job, often involving the suppression or induction of certain emotions.

Pay

The earnings given to an individual by an employer or client in return for their work or services, often specified as an hourly wage or salary.

Positive Emotions

Feelings that are generally uplifting and pleasant, such as joy, gratitude, serenity, interest, hope, pride, amusement, inspiration, awe, and love.

Interactional Fairness

The perceived fairness of the communication processes and interpersonal interactions by which organizational decisions are implemented and conveyed.