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Assume Rush Corp needs to borrow/finance $500,000 for one year for its Mexican operations. The annual interest rate is 2% in the United States and

Assume Rush Corp needs to borrow/finance $500,000 for one year for its Mexican operations. The annual interest rate is 2% in the United States and 8% in Mexico.

If Rush Corp borrows Mexican pesos at 8%, and the U.S. dollar depreciates by 7%, then what is Rush Corps effective financing rate in dollars?

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