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3. FX forwards By constructing two different portfolios, both of which are worth one unit of foreign currency at time T, prove by replication that

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3. FX forwards By constructing two different portfolios, both of which are worth one unit of foreign currency at time T, prove by replication that the forward price at time t for one unit of foreign currency is given by (rs-ri)(T-t F (t, T) XesXT-+) where X is the price at time t of one unit of foreign currency and Tis the maturity of the forward contract

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