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Assume the U. interest rate is .075, the Australia interest rate is 0.049, the spot rate of the AD$ is $0.57, and the oneyear forward rate of the AD$...

Assume the U.S. interest rate is .075, the Australia interest rate is 0.049, the spot

rate of the AD$ is $0.57, and the one‑year forward rate of the AD$ is $.50. At

the end of the year, the spot rate is $0.43. Based on this information, what is

the effective financing rate for a U.S. firm that takes out a one‑year,

uncovered AD$ loan?

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