An Australian Firm Goes to the US to Borrow Because

An Australian firm goes to the US to borrow because US interest rates are only 3% compared with 6.5% in Australia.The transaction is fully hedged using an FX swap.What will be the effective cost of funds?

A) 3%
B) More than 3%, but less than 6.5%
C) 6.5%
D) It depends on the spot exchange rate.
E) This cannot be determined with the information provided.