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If interest rate parity holds between the US and a foreign country, transactior costs are zero, and the forward rate is an unbiased predictor of
If interest rate parity holds between the US and a foreign country, transactior costs are zero, and the forward rate is an unbiased predictor of future spot rate, then the effective investment return for a U.S company that invests in the foreign country on a covered basis would be: Less than the U.S. return. Equal to the U.S return. O More than the foreign return. Less than the foreign return. Equal to the foreign return
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