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Assume the following information: Current spot rate of New Zealand dollar - $.6686 Forecasted spot rate of New Zealand dollar 1 year from now- $.7012
Assume the following information: Current spot rate of New Zealand dollar - $.6686 Forecasted spot rate of New Zealand dollar 1 year from now- $.7012 One year forward rate of the New Zealand dollar $.6849 Annual interest rate on New Zealand dollars - 5% Annual interest rate on U.S. dollars - 6% Compute the return from covered interest arbitrage by a U.S. investor with $1000 to invest. O 5.00% O 2.55 % O 7.55% O 8.58% 06.00%
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