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A Japanese investor can earn a 1 percent annual interest rate in Japan or about 3.5 percent per year in the United States. If the
A Japanese investor can earn a 1 percent annual interest rate in Japan or about 3.5 percent per year in the United States. If the spot exchange rate is 101 yen to the dollar, at what one-year forward rate would an investor be indifferent between the U.S. and Japanese investments?
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