24-88 At the end of the year 2,the exchange rate is €1/$.What are the losses and gains to each bank as a result of this swap.Ignore principal payments and compare it to the scenario where it did not engage in the swap.
A)With the agreement,Bank Dresdner pays €2.5 million less while Bank USA pays $1.25 more.
B)With the agreement,Bank Dresdner pays €2.5 million more while Bank USA pays $2.5 million less.
C)With the agreement,Bank USA pays $3.75 million less while Bank Dresdner pays €7.5 million more.
D)With the agreement,Bank USA pays $3.75 million more while Bank Dresdner pays €7.5 million less.
E)Each bank pays the same because the exchange rate affects both parties equally

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The Answer of 24-88 At the end of the year 2,the exchange rate is €1/$.What are the losses and gains to each bank as a result of this swap.Ignore principal payments and compare it to the scenario where it did not engage in the swap.
A)With the agreement,Bank Dresdner pays €2.5 million less while Bank USA pays $1.25 more.
B)With the agreement,Bank Dresdner pays €2.5 million more while Bank USA pays $2.5 million less.
C)With the agreement,Bank USA pays $3.75 million less while Bank Dresdner pays €7.5 million more.
D)With the agreement,Bank USA pays $3.75 million more while Bank Dresdner pays €7.5 million less.
E)Each bank pays the same because the exchange rate affects both parties equally

24-88 at the End of the Year 2,the Exchange Rate