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An investor invests in a Japanese bond at 6.5% for one year. If the spot exchange rate is 110.00 yen per USD and the one

An investor invests in a Japanese bond at 6.5% for one year. If the spot exchange rate is 110.00 yen per USD and the one year forward exchange rate is 112, what return should the investor expect on an equivalent USD investment?

Answer choices:

5.92%

4.60%

5.20%

6.50%

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