Question
Assume the interest rate on a one year U.S. government debt security is currently 9.5% compared with 7.5% on a foreign country's comparable maturity debt
Assume the interest rate on a one year U.S. government debt security is currently 9.5% compared with 7.5% on a foreign country's comparable maturity debt security. If the U.S. dollar value of the foreign country's currency is $1.50, what is the expected exchange rate on one year from now based on interest rate parity?
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Finance Applications and Theory
Authors: Marcia Cornett
4th edition
1259691411, 978-1259691416
