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Denim Industries can borrow its needed financing for expansion using one of two foreign lending facilities. It can borrow at a nominal annual interest rate
Denim Industries can borrow its needed financing for expansion using one of two foreign lending facilities. It can borrow at a nominal annual interest rate of 11% in Mexican pesos or it can borrow at 2% in Canadian dollars. If the peso is expected to depreciate by 10.42% and the Canadian dollar is expected to appreciate by 2%, which loan has the lower effective annual interestrate?
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