3. Suppose a MNC needs to borrow funds and is looking at three different loan structures. Each is intended to provide, say, $1 million in financing for a 3-year period. Briefly explain the benefits and risk for each strategy. A. Borrow $1 million for three years at a fixed rate of interest. B. Borrow $1 million for three years at a floating rate, LIBOR + 2% (LIBOR to be reset annually). C. Borrow $1 million for one year at a fixed rate then renew the credit annually.

3. Suppose a MNC needs to borrow funds and is looking at three different loan structures. Each is intended to provide, say, $1 million in financing for a 3-year period. Briefly explain the benefits and risk for each strategy. (Safe) A. Borrow $1 million for three years at a fixed rate of interest. B. Borrow $1 million for three years at a floating rate, LIBOR +2% (LIBOR to be reset annually). (Solidifys cred it but could casse losses in interest). C. Borrow $1 million for one year at a fixed rate then renew the credit annually. (credit is more risky, howeder, exchange rate is set)