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1) Assume that you borrow USD 1.000.000 for six months, and you lend EUR 1.500.000an initially equivalent amountfor six months, at per annual rates of

1) Assume that you borrow USD 1.000.000 for six months, and you lend EUR 1.500.000an initially equivalent amountfor six months, at per annual rates of 6% and 8%, respectively, with a right of offset. What is the equivalent spot and forward exchange rate? (10 points)

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