Use the Following Information to Calculate the Quality Spread Differential

Multiple Choice

Use the following information to calculate the quality spread differential (QSD) : $\begin{array}{lll}&\text { Fixed-Rate } & \text { Floating-Rate } \\&\text { Borrowing Cost } & \text { Borrowing Cost }\\\text { X Company: } & 10 \% & \text { LIBOR } \\\text { Y Company: } & 12 \% & \text { LIBOR }+1.5\end{array}$

A) 0.50%
B) 1.00%
C) 1.50%
D) 2.00%