Question
If the current exchange rate is $1.65/, the 1-year forward exchange rate is $1.85/, and the interest rate on British government bills is 7% per
| If the current exchange rate is $1.65/, the 1-year forward exchange rate is $1.85/, and the interest rate on British government bills is 7% per year. |
| What risk-free dollar-denominated return can be locked in by investing in the British bills? (Round your answer to 2 decimal places. Do not round intermediate calculations. Omit the "%" sign in your response.) |
| Risk-free dollar-denominated return | % |
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Managing Finance
Authors: CMI Books
1st Edition
1781252181, 978-1781252185
