Assume Jelly Ltd, a UK-Based MNC, Obtains a One-Year Loan

Multiple Choice

Assume Jelly ltd, a UK-based MNC, obtains a one-year loan of 1,500,000 Malaysian ringgit (MYR) at a nominal interest rate of 7 per cent. At the time the loan is extended, the spot rate of the ringgit is £0.14. If the spot rate of the ringgit in one year is £0.16, the pound amount initially obtained from the loan is £____, and £____ are needed to repay the loan.

A) 210,000; 256,800
B) 210,000; 375,100
C) 6,000,000; 5,357,143
D) 5,357,143; 6,000,000