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QUESTION 8 Suppose that survey of exchange rate traders finds that all currency traders expect the exchange rate to be 1.00 one year from now.

QUESTION 8

  1. Suppose that survey of exchange rate traders finds that all currency traders expect the exchange rate to be 1.00 one year from now. What is the risk premium.

    0.10

    15

    0.02

    0.20

QUESTION 9

  1. Given 8. What is the expected return on your investment in Indonesia.

    0.10

    22

    0.00

    0.05

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