Question
interest rate parity equation is A U.S. investor is considering a risk-free British bill with an annual rate of 7% (foreign rate). The current exchange
interest rate parity equation is 
A U.S. investor is considering a risk-free British bill with an annual rate of 7% (foreign rate). The current exchange rate is $1.22 per pound.
a) What is the investors rate of return in dollars (domestic rate) if the dollar strengthens by 4 cents?
b) What is the investors rate of return in dollars (domestic rate) if the dollar weakens by 4 cents?
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Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes
11th International Edition
1259094901, 9781259094903
