Economist: the most economically efficient way to reduce emissions of air pollutants is to tax them in proportion to the damage they are likely to cause. but in country y, many serious pollutants are untaxed and unregulated, and policy makers strongly oppose new taxes. therefore, the best way to achieve a reduction

A$100 million interest rate swap has a remaining life of 10 months. under the terms of the swap, the six-month libor is exchanged semi-annually for 12% per annum. the six-month libor rate in swaps of all maturities is currently 10% per annum with continuous compounding. the six-month libor rate was 9.6% per annum two months ago. what is the current value of the swap to the party paying floating? what is its value to the party paying fixed?