The euro is expected to depreciate vis--vis the dollar at 3.5% per annum. What is the effective cost of this loan for McDougan? places.) \begin{tabular}{|c|c|c|c|c|c|c|c|} \hline & & Year 0 & Year 1 & & Year 2 & & Year 3 \\ \hline Proceeds from borrowing euros & & 85,000,000 & & & & & \\ \hline Interest payment due in euros & & & & ] & & ] & \\ \hline Repayment of principal in year 3 & & & & & & & (85,000,000) \\ \hline Total cash flow of euro-denominated debt & & ] & & ] & & ] & \\ \hline Expected exchange rate, $=1.00 & & 1.3365 & & & & & \\ \hline Dollar equivalent of euro-denominated cash flow & $ & $ & & $ & & $ & \\ \hline \end{tabular}