The Current Euro Yield Curve on the Euro Eurobond Market $\bullet$

The current euro yield curve on the euro Eurobond market is flat at 4% for top-quality borrowers. A French company of good standing can issue plain-vanilla straight and floating-rate dollar Eurobonds at the following conditions:
$\bullet$ Bond A: Straight bond. Five-year straight dollar Eurobond with a coupon of 4%.
$\bullet$ Bond B: Floating rate note (FRN). Five-year dollar FRN with a semiannual coupon set at London InterBank Offered Rate (LIBOR).
An investment banker proposes to the French company to issue bull and/or bear FRNs at the following conditions:
$\bullet$ Bond C: Bull FRN. Five-year FRN with a semiannual coupon set at:
7.60% - LIBOR.
$\bullet$ Bond D: Bear FRN. Five-year FRN with a semiannual coupon set at:
2* LIBOR -4.2%.
The floor on all coupons is zero. The investment bank also proposes a five-year floor option at 2.1%. This floor will pay to the French company the difference between 2.1% and LIBOR, if it is positive, or zero if LIBOR is above 2.1%. The cost of this floor is spread over the payment dates and set at an annual 0.05%. The bank also proposes a five-year cap at 7.60%. The annual premium on the cap is 0.1%. The company can also enter in a five-year interest-rate swap of 4% fixed against LIBOR.
a. Assume that the French company issues Bonds C and D in equal proportions. Is it more advantageous than issuing Bonds A and B in equal proportion and why?
b. Find out the borrowing cost reduction that can be achieved by issuing the bull Note C compared to issuing a fixed-coupon straight Bond A at 4%.
c. Find out the borrowing cost reduction that can be achieved by issuing the bull Note C compared to issuing a plain-vanilla FRN B at LIBOR.
d. Find out the borrowing cost reduction that can be achieved by issuing the bear Note D compared to issuing a fixed-coupon straight Bond A at 4%.
e. Find out the borrowing cost reduction that can be achieved by issuing the bear Note D compared to issuing a plain-vanilla FRN B at LIBOR.