Question
A French investor holds 1000 euros. She only can invest in Brazil or the US. The spot exchange rate is 1 euro to 1.2 USD,
A French investor holds 1000 euros. She only can invest in Brazil or the US. The spot exchange rate is 1 euro to 1.2 USD, which is expected to be constant over the following years.
a. Determine the interest rate in Brazil so that the investor is indifferent between investing in Brazil and the US.
b.How a Euro depreciation would affect a)?
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The Economics of Women Men and Work
Authors: Francine D. Blau, Marianne A. Ferber, Anne E. Winkler
7th edition
978-0190670863, 019067086X, 132992817, 978-0132992817
