A us bank converted 1 million to swiss francs to make a, Ask an Expert

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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 1.2 francs per dollar. The borrower agreed to repay the principal plus 5 percent interest in one year. The borrower repaid Swiss francs at loan maturity and when the loan was repaid the exchange rate was 1.3 francs per dollar. What was the bank's dollar rate of return?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91535929

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