Question
If annualized nominal interest rates in the US and Switzerland are 12% and 8% respectively and the 90-day forward [one-year forward] rate for the Swiss
If annualized nominal interest rates in the US and Switzerland are 12% and 8% respectively and the 90-day forward [one-year forward] rate for the Swiss franc is $1.0218, at what current spot rate for the Swiss frank will interest rate parity hold? a. $1.0418. b. $1.0215. c. $1.4184. d. $1.0022e. None of the above.
The answer is $1.0119 for 90-day forward
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