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Question 11 Please use the data below, to answer the following question. Interest rate in US (Rh): Interest rate in Canada (Rh): 5% 7% $0.800

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Question 11 Please use the data below, to answer the following question. Interest rate in US (Rh): Interest rate in Canada (Rh): 5% 7% $0.800 The current spot rate for CAD (So): 1-year forward rate for CAD (F): $0.791 The covered interest rate arbitrage trades that this will generate will cause: O Downward pressure on the CAD's spot rate. Downward pressure on the CAD's forward rate. 10 pts

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