An FI has purchased (borrowed) a one-year $14 million Eurodollar deposit at an annual interest rate of 5.4 percent. It has invested these proceeds in one-year Euro () bonds at an annual rate of 8.9 percent after converting them at the current spot rate of 1.754/$. Both interest and principal are paid at the end of the year. What is the spread earned by the bank if the end-of-year exchange rate is 1.7666/$?

a.8.12%

b.4.71%

c.9.68%

d.4.28%

e.2.72%