ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Millon National Bank has 8 million British pounds (£) in one-year assets and £6 million in one-
е.
year liabilities. In addition, it has one-year liabilities of 3.5 million euros (€). Assets are earning
8 percent and both liabilities are being paid at a rate of 7 percent. All interest and principal will
be paid at the end of the year. What is the net interest income in dollars if the spot prices at the
end of the year for US $ to British £ are $1.30/£ and for Euro to US $ are €1.25/$
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Transcribed Image Text:Millon National Bank has 8 million British pounds (£) in one-year assets and £6 million in one- е. year liabilities. In addition, it has one-year liabilities of 3.5 million euros (€). Assets are earning 8 percent and both liabilities are being paid at a rate of 7 percent. All interest and principal will be paid at the end of the year. What is the net interest income in dollars if the spot prices at the end of the year for US $ to British £ are $1.30/£ and for Euro to US $ are €1.25/$
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