Question
Assume the following information:Current spot rate of New Zealand dollar = $0.41 Forecasted spot rate of New Zealand dollar 1 year form now = $0.43
- Assume the following information:\Current spot rate of New Zealand dollar = $0.41
Forecasted spot rate of New Zealand dollar 1 year form now = $0.43
One-year forward rate of the New Zealand dollar = $0.42
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 ______
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Intermediate Accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson
6th edition
978-0077328894, 71313974, 9780077395810, 77328892, 9780071313971, 77395816, 978-0077400163
