Question

# McDougan Associates? (U.S.). McDougan? Associates, a? U.S.-based investment? partnership, borrows euro€85,000,000 at a time when the...

McDougan Associates? (U.S.). McDougan? Associates, a? U.S.-based investment? partnership, borrows

euro€85,000,000 at a time when the exchange rate is ?\$1.3304?/euro€. The entire principal is to be repaid in three? years, and interest is 6.350?% per? annum, paid annually in euros. The euro is expected to depreciate? vis-à-vis the dollar at 3.1?% per annum. What is the effective cost of this loan for? McDougan?

Complete the following table to calculate the dollar cost of the? euro-denominated debt for years 0 through 3. Enter a positive number for a cash inflow and negative for a cash outflow.???(Round the amount to the nearest whole number and the exchange rate to four decimal? places.)

 Year 0 Year 1 Year 2 Year 3 Proceeds from borrowing euros € 85,000,000 Interest payment due in euros € € € Repayment of principal in year 3 (85,000,000) Total cash flow of euro-denominated debt € € € € Expected exchange rate, \$/€ 1.3304 Dollar equivalent of euro-denominated cash flow \$ \$ \$ \$

What is the effective cost of this loan for? McDougan?

 McDOUGAN ASSOCIATES (U.S):
 Year 0 Year 1 Year 2 Year 3 Proceeds from borrowing euros €85,000,000 Interest payment due in euros €(5,397,500) €(5,397,500) €(5,397,500) Repayment of principal in year 3 €(85,000,000) Total cash flow of euro-denominated debt €(5,397,500) €(5,397,500) €(90,397,500) Expected exchange rate , \$/€ 1.3304 1.2892 1.2492 1.2105 Dollar equivalent of euro denominated cash flow \$113,084,000 \$(6,958,457) \$(6,742,557) \$(109,426,174)

#### Earn Coins

Coins can be redeemed for fabulous gifts.

##### Need Online Homework Help?

Most questions answered within 1 hours.

##### Active Questions
• You wish to test the following claim (H1H1) at a significance level of α=0.001α=0.001.       Ho:μ1=μ2Ho:μ1=μ2       H1:μ1>μ2H1:μ1>μ2...
• A trough is 2 feet long and 1 foot high. The vertical cross-section of the trough...
• At the instant shown, the car at A is traveling 10 m/s at 45° SE around...
• A factorial experiment was designed to test for any significant differences in the time needed to...
• 1. Suppose X~N(0,1), what is Pr (X< -1.96) 2. Suppose X~N(0,1), what is Pr (1.20 <X<1.96)...
• How much does a sleeping bag cost? Let's say you want a sleeping bag that should...