USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 16

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
The Skalmory Corporation has entered into a three-year interest rate swap, with semiannual settlement, to pay a fixed rate of 7.5 percent per year and receive six-month LIBOR. The notional principal is $10,000,000.
-Refer to Exhibit 15.17. Assuming that one year after the swap was initiated the fixed rate on a new two-year receive fixed pay floating LIBOR swap has fallen to 7 percent per year, calculate the market value of the 7.5 percent fixed rate bond based on a $100 face value. Settlement is on a semiannual basis.

• A) $101.33
• B) $100.92
• C) $100.00
• D) $98.67
• E) $95.83

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Definitions:

Internal Attribution

The inclination to attribute one's own actions and experiences to personal factors rather than to external factors.

Poor Performance

Describes below average or failing work output by an employee or organization, often requiring corrective measures.

Stereotyping

The act of assigning generalized characteristics to individuals based solely on membership in a particular group.

Mental Effort

The amount of cognitive resources required to perform a task or solve a problem, varying with the complexity of the task and the individual's abilities.