Consider the following equation: 
= 
(1 + 
) - 1 The term rCAD in this equation refers to:
A) the cost of capital for the firm in terms of yen.
B) the cost of capital in terms of dollars.
C) the risk-free rate of interest on the dollar.
D) the risk-free rate of interest on the yen.
E) the yen/dollar exchange rate,
Correct Answer:
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