1. If the current 180 day inter-bank Eurodollar rate is 15% (all rates are started on an annualized basis, and next period’s LIBOR is 13%, then a Eurocurrency loan priced at LIBOR plus 1% will cost
16% this period and 16% next period
15% this period and 14% next period
16% this period and 14% next period
15% this period and 15% next period
2. Suppose affiliate A sells goods worth $1 million monthly to affiliate B on 30 day credit terms. A switch in credit terms to 60 days will involve a one time shift in cash of
$ 3 million from A to B
$ 3 million from B to A
$ 1 million from A to B
$ 1 million from B to A
3. SCI borrows SFr 1.5 million from credit Suisse for one year at 9.3% interest. Interest is prepaid. What is the effective SFr interest rate on SCI’s loan?
10.86%
13.64%
10.25%
10.50%