學門類別
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Spencer Hall (A)
內容大綱
The treasurer of The University of Western Ontario was preparing a recommendation to the Spencer Hall board of directors concerning the financing of the $7.7 million expansion to Spencer Hall. The expansion was currently being financed with short-term loans but the board was concerned about increasing rates and was considering such hedging vehicles as interest rate swaps, caps and collars. A follow-up case is available (9A97N004).
學習目標
Students are introduced to interest rate risk management through the use of financial markets. Through this, students are exposed to derivative securities such as CAPs, Caps and Collars. Ultimately, students are introduced to an analytical framework that aids decision makers when choosing between hedging vehicles.