Sahali Trading Company Has Issued $100 Million Worth of Long-Term

question 36

Multiple Choice

Sahali Trading Company has issued $100 million worth of long-term bonds at a fixed rate of 9%.Sahali Trading Company then enters into an interest rate swap where they will pay LIBOR and receive a fixed 8.00% on a notional principal of $100 million.After all these transactions are considered,Sahali's cost of funds is __________.

• A) 17%
• B) LIBOR
• C) LIBOR + 1%
• D) LIBOR - 1%

---

Definitions:

Object Permanence

The awareness that entities remain in existence even if they are not perceived through sight, sound, or other sensory means.

Erikson

Refers to Erik Erikson, a developmental psychologist known for his theory on the psychosocial development of humans, which outlines eight stages from infancy to adulthood.

Piaget

A Swiss psychologist known for his pioneering work in child development, particularly his theory of cognitive development.

Harlow

Refers to Harry Harlow, a psychologist known for his research on maternal separation and social isolation in rhesus monkeys.