2008 Study Session 17 - Page 304 - Concept Checker #10. Answer: D When calculating the fixed-rate side, why did they multiply by 5,050,000 and not the notional principal of 5,000,000? Is this a typo? Thanks

if possible please type out the whole question most people dont have their books at work, thx

It’s probably Libor and not an interest-paying bond. For the calculation however, I believe CFAI tells you to ignore this difference.

maybe the extra 50k comes from the last payment due or maybe the exchange rate changed those are possibilities but i can’t tell without the question

no it ainta typo 5,050,00 is the value the fixed side will be getting in x number of days (forget when u are valuing the spots, x number of days into the agreement) so 505000 has to be brought back to the present using the present libor discount factor fyi i have a shared spreadsheet that helps a lot with swaps look for it under the thread: "miracles do happen (even with swaps) 1luv

aladak Just to let you know… the shared spreadsheet does not share the formula on the sheet… It shows up each cell as a “text” field (albeit with a # in it). and most of the time you need to know the formula behind the cell to see the workings… CP