CIMA Exam CIMAPRA19-F03-1 Topic 1 Question 13 Discussion

Actual exam question for CIMA's CIMAPRA19-F03-1 exam

Question #: 13
Topic #: 1

A company has some 7% coupon bonds in issue and wishes tochangeitsinterest rate profile.

It has decided to do this by entering into a plain coupon interest rate swap with it's bank.

The bank has quoted a swap rate of: 6.0% - 6.5% fixed against LIBOR.

What will the company'snew interest rate profilebe?

AVARIABLE at LIBOR

BVARIABLE at LIBOR + 0.5%

CVARIABLE at LIBOR + 1.0%

DFIXED at 6.5%

Show Suggested Answer

Suggested Answer: C

by Melodie at May 09, 2022, 07:49 PM

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