Consider a $3-$year annual currency swap that takes place between a foreign firm $($FF$)$

with FC currency units and a United States firm $($USF$)$ with $ currency units. USF is

the fixed$-$rate payer and $FF$ is the floating$-$rate payer. The fixed interest rate at the

initiation of the swap is $7\%,$ and $8\%$ at the end of the swap. The variable rate is $5\%$

currently; $6\%$ at the end of year $1$;$8\%$ at the end of year $2$; and $7\%$ at the end of year

At the beginning of the swap, $$1\mathrm{.}0$ million is exchanged at an exchange rate of

$FC2\mathrm{.}0=$$$1\mathrm{.}0.$ At the end of the swap period the exchange rate is FC $1\mathrm{.}5=$ $$1\mathrm{.}0.$ At

the termination of the swap, FF gives USF which of the following notional amounts?

$$1$ million

$$666,666$

FC$2$ million

FC$1\mathrm{.}5$ million