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Assume the following information: Current spot rate of New Zealand dollar $0.66 Forecasted spot rate of New Zealand dollar 1 year from now $0.69 One-year
| Assume the following information: | |
| Current spot rate of New Zealand dollar | $0.66 |
| Forecasted spot rate of New Zealand dollar 1 year from now | $0.69 |
| One-year forward rate of the New Zealand dollar | $0.68 |
| Annual interest rate on New Zealand dollars | 8% |
| Annual interest rate on U.S. dollars | 9% |
| Given the information in this question, the return from covered interest arbitrage by U.S. investors with $500,000 to invest is ____ percent. |
| 11.27 |
| 8.00 |
| 12.91 |
| 12.30 |
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Multinational Business Finance
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
12th Edition
0136096689, 978-0136096689
