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Suppose that the 6-month nominal risk-free rate in Indonesia is 6.5 percent, and the 6-month nominal risk-free interest rate in Malaysia is 5.5 percent. Compute
Suppose that the 6-month nominal risk-free rate in Indonesia is 6.5 percent, and the 6-month nominal risk-free interest rate in Malaysia is 5.5 percent. Compute the 6-month forward MYR/IDR exchange rate. Use the spot MYR/IDR exchange rate from part (a.ii) above, which is equal to 3,292.37.
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