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Suppose that Curry Co., a U.S.-based MNC, has a subsidiary in Switzerland that needs to borrow 40,000,000 Swiss francs (SF) for 5 years. A five

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Suppose that Curry Co., a U.S.-based MNC, has a subsidiary in Switzerland that needs to borrow 40,000,000 Swiss francs (SF) for 5 years. A five year loan from a Swiss bank would require annual interest payments of 8.00%, with the principal being repaid in year 5. These payments are shown in the first row of the table. Alternatively, Curry can obtain a 3-year loan at an annualized rate of 6.00%. After three years, Curry will be able to extend the loan for another two years, at a forecasted annualized rate of 11.00%. If Curry chooses this option, it must pay back the original principal in year 5. Complete the second of the table, filling in the payments made from Curry in each year (including the principal) for the 3-year loan, followed by the 2-year loan extension. Year 1 Loan Payments (Swiss Francs) Year 2 Year 3 Year 4 3,200,000 3,200,000 3,200,000 Year 5 3,200,000 43,200,000 5-Year Loan at 8.00% 3-Year Loan at 6.00%, 2-Year Loan at 11.00%

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