1. Company A can borrow yen at 14.7 percent and dollars at 13.7 percent. Company B can borrow yen at 13.7 percent and dollars at 13.367 percent. If a financial intermediary charges a fee of 0.1 percent, what is the gain to each party to the swap? The gain is evenly split between the two parties and exchange rate risk assumed by the intermediary.
a. 0.38333 percent
b. 0.28333 percent
c. 0.33333 percent
d. 0.56667 percent
2. Jamie is analyzing the estimated net present value of a project under various conditions by revising the sales quantity, sales price, and the cost estimates. The type of analysis that Jamie is doing is best described as:
sensitivity analysis.
erosion planning.
scenario analysis.
benefit planning.
opportunity evaluation.