Question 291 (Mandatory) (15 points) TECHNOTHERM CORPORATION was founded in 1972 by bringing together a skiled professional 16am gstablished in the fleld of waste heat recevery. Technotherin just executed a 3 yoar cortract with the State of Germany to deliver (10) Firetube Bolers to a stabe-owned entity. Each Doler Technotherm constructs can be buit in Belgum of Tulsa. OK. The cost of manulacturing is 82,750,000. The terms of the contract specity that Technotherm must accept payment tor the Bcilers in Euro, which isnt a problem because Technotherm maintains a multi-cuerency account in London and holds plenty of C. It will take Technotheem 3 yess to complete the construction and delivery of the Boilers. Technotherm's CFO looked up the conversion aabes of 6/5 for today and in 3 years. The spot 6/5 rate is 1.05476 and the 3yr Forward is 1.10757. Aleo, the CFO checked the 30-day and 90-day LIBOR rates, which are 4.22F and 4.73N respectively. Three year SWAP rates mre 3.84\% for 30 -day LBOP and 4.63% for 90 day LBOP. Technotherm must borrow finance the construction of the Boilers. The company has hwo financing options: USBANK: 1. 75% of the cost of manutacturing 2. Inlerest only per annum, paid in monthly payments 3. Pate Options: 3. 30 DAY LBOR+6 Y b. 10 's FIXED FOP 3 YEARS DEUTCHE RANK: 1. 80% of the cait of manufacturing 2. Interest only per ancum, paid in quarterly psyments 3. Rate Optiona: a. 90 DAY LIECA +SN b. 9* FIXED FOR 3 YEAPS 1. Assuming the cost of equfy for Technotherm is 10% : What is the cost of oquity in USD at the end