Question
Suppose the interest rate in the US is 4.60% and in the UK is 6.01%. The current spot rate of British pounds is $1.815; the
Suppose the interest rate in the US is 4.60% and in the UK is 6.01%. The current spot rate of British pounds is $1.815; the 21-day forward rate of the pound is $1.769. What is the equilibrium UK interest rate in percentage (keep 2 decimal)?
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Financial Institutions Management A Risk Management Approach
Authors: Anthony Saunders, Marcia Cornett
6th Edition
0077211332, 9780077211332
