Axil CorpHas Not Tapped the Deutsche Mark Public Debt Market Because

question 14

Multiple Choice

Axil Corp.has not tapped the Deutsche mark public debt market because of concern about a likely appreciation of that currency and only wishes to be a floating-rate dollar borrower,which it can be at LIBOR + 1%.Bevel Corp.strongly prefers fixed-rate DM debt,but it must pay 1.5% more than the 6 1/4% coupon that Axil's DM notes would carry.Bevel,however,can obtain Eurodollars at LIBOR + ½%.
-What is the maximum possible cost savings to Axil from engaging in a currency swap with Bevel?

• A)1%
• B)75%
• C)2%
• D)1.25%

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Definitions:

Stigmatized Group

A social group that is negatively discriminated against and marginalized due to characteristics deemed undesirable by society.

Vigilant to Prejudice

The state of being acutely aware of and actively responsive to instances of prejudice or discrimination.

Willing to Cooperate

A disposition or readiness to work together with others towards common goals or interests.

Female Engineering Students

Refers to women who are pursuing or have completed their education in the field of engineering, which historically has been male-dominated.