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is this correct= -0.21 Assume the U.S. interest rate is .075, the New Zealand interest rate is 0.049, the spot rate of the NZ$ is

is this correct= -0.21

Assume the U.S. interest rate is .075, the New Zealand interest rate is 0.049, the spot

rate of the NZ$ is $0.57, and the oneyear forward rate of the NZ$ is $.50. At

the end of the year, the spot rate is $0.43. Based on this information, what is

the effective financing rate for a U.S. firm that takes out a oneyear,

uncovered NZ$ loan?

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