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Suppose an individual firm is comparing two investments, a one year bond from a U.S. firm paying 6% or a one year bond from a
Suppose an individual firm is comparing two investments, a one year bond from a U.S. firm paying 6% or a one year bond from a French firm which is paying 8%. The current dollars-per-euro rate is 0.75, and the expected rate in one year is 0.72. If the expected rate is correct, which investment will receive the higher return?
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