Exhibit 14-10 USE THE FOLLOWING INFORMATION FOR THE NEXT QUESTION(S)

question 7

Multiple Choice

Exhibit 14-10
USE THE FOLLOWING INFORMATION FOR THE NEXT QUESTION(S)
The WallMal Company has entered into a 4-year interest rate swap, with semiannual settlement, to pay a fixed rate of 8% per year and receive 6-month LIBOR. The notional principal is $50,000,000.
-Refer to Exhibit 14-10. Assume that one year later the fixed rate on a new 3-year receive fixed pay floating LIBOR swap has fallen to 7% per year. Settlement is on a semiannual basis. Calculate the market value of the FRN based on $100 face value.

• A) $102.66
• B) $100.00
• C) $95.56
• D) $89.63
• E) $70.77

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Definitions:

Binocular Disparity

The difference in image location of an object seen by the left and right eyes, resulting from the eyes’ horizontal separation and providing a basis for depth perception.

Perceptual Hypotheses

Assumptions made by the brain in order to interpret sensory information and perceive the environment.

Psychology

The scientific study of the mind and behavior, encompassing a variety of fields including cognitive, biological, and social aspects.

Empirical

Is grounded on, revolves around, or can be authenticated by experiencing or witnessing phenomena directly, rather than by theoretical inference or logical suppositions.