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Chapter 21 Pre-built problems Question 9 (of 9) g. value: 11.12 points Suppose the spot and six-month forward rates on the Norwegian krone are Kr
Chapter 21 Pre-built problems Question 9 (of 9) g. value: 11.12 points Suppose the spot and six-month forward rates on the Norwegian krone are Kr 5.73 and Kr 5.88, respectively. The annual risk-free rate in the United States is 3.53 percent, and the annual risk-free rate in Norway is 5.23 percent. Using the approximation, the six-month forward rate on the Norwegian krone would have to be Kr/$ to prevent arbitrage. (Do not round intermediate calculations. Round your answer to 4 decimal places, e.g., 32.1616.)
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