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Consider the Situation of Firm a and Firm B $ A $7%6%B$8%5%\begin{array} { l l l } & \$ & € \\\text { A } & \$ 7 \% & € 6 \% \\B & \$8 \% & € 5\%\end{array}

question 11

Essay

Consider the situation of firm A and firm B.The current exchange rate is $1.50/€.Firm A is a U.S.MNC and wants to borrow €40 million for 2 years.Firm B is a French MNC and wants to borrow $60 million for 2 years.Their borrowing opportunities are as shown; both firms have AAA credit ratings.
$ A $7%6%B$8%5%\begin{array} { l l l } & \$ & € \\\text { A } & \$ 7 \% & € 6 \% \\B & \$8 \% & € 5\%\end{array} Devise a direct swap for A and B that has no swap bank.Show their external borrowing.  Consider the situation of firm A and firm B.The current exchange rate is $1.50/€.Firm A is a U.S.MNC and wants to borrow €40 million for 2 years.Firm B is a French MNC and wants to borrow $60 million for 2 years.Their borrowing opportunities are as shown; both firms have AAA credit ratings.   \begin{array} { l l l }  & \$ & € \\ \text { A } & \$ 7 \% & € 6 \% \\ B & \$8 \% & € 5\% \end{array}  Devise a direct swap for A and B that has no swap bank.Show their external borrowing.

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Definitions:

Overextension

A language development error in which a child applies a word to more objects than it actually represents, demonstrating an understanding but not precise use of words.

Oversemanticizing

The process of excessively analyzing or interpreting the meanings of words beyond their direct or literal context.

Gestural Language

A form of non-verbal communication using movements of the hands, arms, or body to convey messages.

Auditory Contact

The perception of sounds by the ear or the psychological connection and communication established through hearing.

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