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Exam F3 All Questions
Exam F3 All Questions

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CIMA Strategic F3 Question # 85 Topic 9 Discussion

F3 Exam Topic 9 Question 85 Discussion:
Question #: 85
Topic #: 9

A company is in the process of issuing a 10 year $100 million bond and is considering using an interest rate swap to change the interest profile on some or all of the $100 million new finance.

 

The company has a target fixed versus floating rate debt profile of 1:1. Before issuing the bond its debt profile was as follows:

 F3 Question 85

 

 

Which of the following is the most appropriate interest rate swap structure for the company? 


A.

Pay fixed receive floating interest rate swap for $100 million.


B.

Pay fixed receive floating interest rate swap for $50 million.


C.

Receive fixed pay floating interest rate swap for $100 million.


D.

Receive fixed pay floating interest rate swap for $50 million.


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