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need help with this The annual interest rate on deposits in Canada is 10%. For Yen deposits in Japan it is 7.5%. The spot rate
need help with this
The annual interest rate on deposits in Canada is 10%. For Yen deposits in Japan it is 7.5%. The spot rate of the Yen to dollar (Eyen/$) is 130 a. Which currency is expected to depreciate in a year and by how much? (2) b. If the covered interest parity condition holds, what is the one year forward rate yen for $ (Fyen/$) (2) c. A Canadian importer plans to pay 1 million yen a year from now. She buys a forward contract and places $X in a Canadian bank deposit so that the proceeds will be used to pay for the forward yen later. Calculate X (2)Step by Step Solution
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