Question
From a recent trip, you recall a spot exchange rate of $4.65 = 4 and 1-year forward rate of 4=$4.75. a) Suppose that the interest
From a recent trip, you recall a spot exchange rate of $4.65 = 4 and 1-year forward rate of 4=$4.75. a) Suppose that the interest rates are 2% APR in the UK. Under IRP, what is the no-arbitrage 1-year interest rate in the US? Round to 4 decimal places. b) What is forward annualized holding period return, round to 4 decimal places?
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Foundations In Personal Finance
Authors: Dave Ramsey
3rd Edition
1936948524, 978-1936948529
