You borrowed money in Polish ZT at 7.0 percent and converted it to euro. After one year when you paid it, Polish ZT had appreciated by 3.5 percent against euro. Your cost of this borrowing is about:

a. 8.0 percent

b. 6.33 percent

c. 10.74 percent

d. None of the answers in this question are correct.

e. 3.25 percent