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A Mexican firm is thinking about borrowing in USD at 3 percent per year.The spot exchange rate for the Mexican peso ( MXN ) is

A Mexican firm is thinking about borrowing in USD at 3 percent per year.The spot exchange rate for the Mexican peso (MXN) is 20 MXN /USD.The one-year forward rate is 21 MXN/USD.Suppose you fully hedge the exchange rate risk of the loan.What does the 3 percent interest rate in USD correspond to in MXN?Note: write your answer as a percentage, and with two decimal places. For example, if the answer is 4.876%, you should write 4.88.

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