Find the Upcoming Net Payment in a Plain Vanilla Interest

question 17

Multiple Choice

Find the upcoming net payment in a plain vanilla interest rate swap in which the fixed party pays 10 percent and the floating rate for the upcoming payment is 9.5 percent.The notional amount is $20 million and payments are based on the assumption of 180 days in the payment period and 360 days in a year.

• A)fixed payer pays $1,950,000
• B)fixed payer pays $950,000
• C)floating payer pays $1 million
• D)floating payer pays $50,000
• E)fixed payer pays $50,000

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