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please help with the attached finance question McDougan Associates (USA). McDougan Associates, a US-based investment partnership, borrows E75,000,000 at a time when the exchange rate
please help with the attached finance question
McDougan Associates (USA). McDougan Associates, a US-based investment partnership, borrows E75,000,000 at a time when the exchange rate is $133221 The entire principal is to be repaid in three years, and interest is 6 250% per annum, paid annually in euros. The euro is expected to depreciate vis--vis the dollar at 29% per annum What is the effective cost of this loan for McDougan? Complete the following table to calculate the dollar cost of the euro-denominated debt for years 0 through 3 Enter a positive number for a cash inflow and negative for a cash outflow. (Round the amount to the nearest whole number and the exchange rate to four decimal places) Year 0 Year 1 Year 2 Year 3 75.000.000 Proceeds from borrowing euros Interest payment due in euros Repayment of principal in year 3 Total cash flow of euro-denominated debt (75,000,000 Expected exchange rate, S/ 1.3322 Dollar equivalent of euro-denominated cash flow
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