What would be favorable outcome swap between companies

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Reference no: EM131560205

Company A can borrow money at a fixed price of 7.5 percent or a variable rate set at prime plus 1 percent. Company B can borrow money at a variable rate of prime plus .5 percent or a fixed rate of 8 percent. Company A prefers a variable rate and Company B prefers a fixed rate. If the swap dealer requires .5 percent profit what would be a favorable outcome swap between Companies A and B?

Reference no: EM131560205

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