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A treasurer has the option of borrowing in dollars or euros. Construct a model to ascertain if there is a potential saving in one of
A treasurer has the option of borrowing in dollars or euros. Construct a
model to ascertain if there is a potential saving in one of the currencies over
91 days. Also what is the breakeven exchange rate? The data is:
Spot EUR / USD 1.4000
Swap 0.0100
USD Interest 3.000%
EUR Interest 5.000%
EUR Margin 0.500%
Amount 10,000,000.00
FYI! Look at p189 pdf file attachment
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