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Given the information: Interest rate in US (Rh): 7% Interest rate in Canada (Rh): 5% Line of credit in US USD 10,000,000 Line of

Given the information: Interest rate in US (Rh): 7% Interest rate in Canada (Rh): 5% Line of credit in US USD 10,000,000 Line of credit in Canada CAD 12,500,000 The spot rate for CAD (SO): $0.80 1-year forward rate for CAD (FR): $0.82 What is your covered rate of return from US (Rch)? 2.439% 7.625% 9.675% 4.390%

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