The Copper Mountain Group, a private equity firm headquartered in Boulder, Colorado (US), borrows 5,000,000 for one
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Question:
The Copper Mountain Group, a private equity firm headquartered in Boulder, Colorado (US), borrows 5,000,000 for one year at 7.375% interest.
a. What is the effective $ interest rate of this debt if the pound depreciates from $2.0260/ to $1.9460/ over the year?
b. What is the effective $ interest rate of this debt if the pound appreciates from $2.0260/ to $2.1640/ over the year?
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