Long-Term Debt-Denomination Decision____ My project is between US and UK If you planned...

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Finance

Long-Term Debt-Denomination Decision____ My project is between US and UK

  • If you planned to borrow long-term funds, you could borrow dollars or you could borrow the foreign currency of concern. Using the Internet or other sources of data, compare the U.S. interest rate to the United Kingdom interest rate over the last 8 quarters. Which interest rate is typically higher?
  • Explain why you might be able to reduce your exposure to exchange rate risk by borrowing long-term funds denominated in the foreign currency of concern.

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