TropiKana Inc

question 40

Multiple Choice

TropiKana Inc., a U.S firm, has just borrowed euro 1,000,000 to make improvements to an Italian fruit plantation and processing plant. If the interest rate is 5.50% per year and the Euro depreciates against the dollar from $1.40/€ at the time the loan was made to $1.35/€ at the end of the first year, how much interest will TropiKana pay at the end of the first year (rounded) ?

• A) $55,000
• B) €74,250
• C) $74,250
• D) $77,000

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Definitions:

Mission Statement

A formal summary of the aims and values of a company, organization, or individual, guiding its decisions and strategies.

Business

An organization or economic system where goods and services are exchanged for one another or for money.

Competitive Advantage

The attributes that allow an organization to outperform its competitors by offering greater value to consumers or operating more efficiently.

Differentiate

The process of making or acknowledging distinctions between things, often to set one apart from others in a competitive market.