Apricot Corporation is a US company that manufactures mobile phone. The company not only sells its mobile phones in US market but also in Japan market. Recently, the company set up a production plant in Japan and the CEO of the company is planning to finance this production plant investment. There are two options: option A: issue a 10 year US dollar debt, option B: issue a 10 year debt in Japanese Yen. Assume that the current Japanese yen interest rate is 1% and US dollar interest rate is 3.5%. You are recently hired as a financial manager of the company and are asked to answer the following questions.

1. Besides financing the investment of manufacturing plant in Japan, is there any other rationale for the use of Japanese yen debt? Illustrate your answer with example.

2. Which option should the company take? What major factors need to be considered? Illustrate your answer with example.