Question
An Australian company wishes to borrow AUD 1,000,000 for ten years. The ten-year bond rate in the U.K. is 3.50%, the AUDGBP spot rate is
An Australian company wishes to borrow AUD 1,000,000 for ten years. The ten-year bond rate in the U.K. is 3.50%, the AUDGBP spot rate is 2.5000 and the estimated spot rate at maturity is 2.8000.
what is the estimated effective annual financing rate?
- 12.39%
- 15.92%
- 57.99%
- 4.68%
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
15th edition
1337671002, 978-1337395250
