Emmilou's Designs, a Canadian Exporter, Operates in International Currencies to Transact

Multiple Choice

Emmilou's Designs, a Canadian exporter, operates in international currencies to transact business on both sides of the Atlantic and so, at a time when the Canadian dollar (CAN) was at $0.97 of the US dollar (USD) and the Euro was trading at .625USD, Emmilou Designs issued 5-year Eurobonds which provided them with the equivalent of $5,000,000CAN. At maturity, the Canadian dollar was worth $1.01USD and the Euro at 0.635USD. What was the financial impact of the exchange rates, in Canadian dollars, in the repayment of the face value of the Eurobonds at maturity?

A) Cost $50,000
B) Saved $192,756
C) Saved $121,188
D) Saved $2.9 million
E) Cost $4.6 million