Question: A U . S . bank converted $ 1 million to Swiss francs to make a Swiss franc loan to a valued corporate customer when

A U.S. bank converted $1 million to Swiss francs to make a Swiss
franc loan to a valued corporate customer when the exchange rate
was 1.35 francs per dollar. The borrower agreed to repay the
principle plus 8% interest in 1 year. The borrower repaid Swiss
francs at loan maturity and when the loan was repaid the exchange
rate was 1.40 francs per dollar. What was the bank's dollar rate of
return? A.4.86 percent B.5.58 percent C.5.21 percent D.4.14
percent

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