Heather​ O’Reilly, the treasurer of CB​ Solutions, believes interest rates are going to​ rise, so she wants to swap her future​ floating-rate interest payments for fixed rates.​ Presently, she is paying LIBOR+2.00​% per annum on $5,200,000 of debt for the next two​ years, with payments due semiannually. LIBOR is currently 3.99​% per annum. Heather has just made an interest payment​ today, so the next payment is due six months from now. Heather finds that she can swap her current​ floating-rate payments for fixed payments of 7.008​% per annum. ​ (CB Solutions’ weighted average cost of capital is 12​%, which Heather calculates to be 6​% per​ 6-month period, compounded​ semiannually).

a. If LIBOR rises at the rate of 50 basis points per​ 6-month period, starting​ tomorrow, how much does Heather save or cost her company by making this​ swap?

b. If LIBOR falls at the rate of 25 basis points per​ 6-month period, starting​ tomorrow, how much does Heather save or cost her company by making this​ swap?

a. If LIBOR rises at the rate of 50 basis points per​ 6-month period, starting​ tomorrow, how much does Heather save or cost her company by making this​ swap?

The swap (cost or savings) for the first​ six-month period is ​$ . ​ (Select from the​ drop-down menu and round to the nearest​ dollar.)