Exam P3 Topic 1 Question 29 Discussion

Actual exam question for CIMA's P3 exam
Question #: 29
Topic #: 1
A US company enters into a five year borrowing with bank A at a floating rate of USD Libor plus 2%.
It simultaneously enters into an interest rate swap with bank B at 3.5% fixed against USD Libor plus 1%.
What is the hedged borrowing rate, taking the borrowing and swap into account?
Give your answer to 1 decimal place

Suggested Answer:

4.5%

by Burgess at Jul 04, 2025, 09:43 AM

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