Foreign Exchange Risk and the cost of Borrowing Swiss Francs. The chapter demonstrated that a firm borrowing in a foreign currency could potentially end up paying a very different effective rate of interest than what it expected. Using the same baseline values of a debt principal of SF1.5 million, a one-year period, an initial spot rate of SF1.4500/$, a 5.118% cost of debt, and a 38% tax rate, what is the effective after-tax cost of debt for one year for a U.S. dollar-based company if the exchange rate at the end of the period was: a. SF1.4500/$ b. SF1.3800/$ c. SF1.3150/$ d. SF1.5850/$ ** a D a. If the exchange rate at the end of the period was SF1.4500/5, what is the effective after-tax cost of debt? 0% (Round to four decimal places.) b. If the exchange rate at the end of the period was SF1.3800/s, what is the effective after-tax cost of debt? 1% (Round to four decimal places.) c. If the exchange rate at the end of the period was SF13150/5, what is the effective after-tax cost of debt? 1% (Round to four decimal places.) d. If the exchange rate at the end of the period was SF 1.5850/5, what is the effective after-tax cost of debt? 0% (Round to four decimal places.)