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20 pts A. If the interest rate in the Brazil is 12%, the interest rate in the U.S.A. is 4% and the spot exchange rate

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20 pts A. If the interest rate in the Brazil is 12%, the interest rate in the U.S.A. is 4% and the spot exchange rate is 4 Real/ US$ and assume Interest Rate Parity holds. What must be the one year forward exchange rate? B. If the forward exchange rate is also 4 Real/ US $, how can an investor take advantage of the situation? Edit View Insert Format Tools Table 12ptv Paragraph : 6S1P 12/11/2010 N

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