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Explain why a risk - neutral investor would be indifferent between a one - year U . S . dollar investment in a risk -

Explain why a risk-neutral investor would be indifferent between a one-year U.S. dollar investment in a risk-free security at 3% and a one-year British pound investment at 3% if the investor expected the $/ spot exchange rate one year later to equal the forward rate as determined by the IRPT. In your explanation, assume the current spot exchange rate is $1.50/BP.

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