The treasurer at University of Western Ontario was preparing a recommendation for the Spencer Hall board of directors related to the funding of the $7.7 million growth to Spencer Hall.
The expansion was now funded with short-term loans, but the board was concerned about rising rates and was contemplating such hedging vehicles. as interest rate swaps, caps, and collars. A follow up case is accessible (9A97N004).
Learning Objective: Pupils are introduced through using financial markets to interest rate risk management.
Through this, pupils are exposed to derivative securities like Collars, Caps, and CAPs. Ultimately, students are introduced to an analytical framework that assists decision-makers in picking between hedging vehicles.
Publication Date: 01/29/1996
This is just an excerpt. This case is about Finance
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