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Please show the work. 1. The US dollar-euro spot exchange rate is $1.50/. If the one-year simple interest rate on dollars is 1% and on
Please show the work.
1. The US dollar-euro spot exchange rate is $1.50/. If the one-year simple interest rate on dollars is 1% and on euro is 2%, what is the one-year forward rate of dollars per euro?
2. How many years does it take to double your money if the continuously-compounded interest rate is 6%?
3. If you wanted to double your money in the same time as in the answer to the previous question, but were using monthly compounding, what would be the rate of interest you would require?
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