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Question
An FI has a 1-year 8-percent US $160 million loan financed with a 1-year 7-percent UK ≤100 million CD. The current exchange rate is $1.60/≤.
If the exchange rate remains the same, what is the dollar spread earned by the bank at the end of the year?
A. $750,000.
B. $1,000,000.
C. $1,250,000.
D. $1,600,000.
E. $1,750,000.
Answer
This answer is hidden. It contains 124 characters.
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