A US-Based Company Needs to Raise Five-Year Financing for a New

question 18

Multiple Choice

A US-based company needs to raise five-year financing for a new project.It will have to pay 5% interest for money raised in dollars,but only 2% interest for money raised in yen because interest rates are lower in Japan.Which of the following is not a risk if the company chooses to raise yen financing?

• A)The yen appreciates against the dollar,and dollar interest rates rise.
• B)The yen appreciates against the dollar,and yen interest rates rise.
• C)The yen depreciates against the dollar,and yen interest rates fall.
• D)The yen depreciates against the dollar,and yen interest rates rise.

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Definitions:

Response

The outcome or measurement of interest in a study or experiment that is influenced by the independent variable.

Year

A period of approximately 365 days or 12 months, used for reckoning time in accordance with the Gregorian calendar.

Results of Race

Results of race typically refer to the final outcomes or standings of a competitive event, detailing the performance and positions of the participants.

Both

Used to refer jointly to two specified or implied subjects, objects, or issues.