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Suppose the one-year forward $/ exchange rate is $1.9 per euro and the spot exchange rate is $1.5 per euro. What is the forward premium
Suppose the one-year forward $/ exchange rate is $1.9 per euro and the spot exchange rate is $1.5 per euro. What is the forward premium on euros (the forward discount on dollars)? The forward premium on euros is percent. (Give your answer as a percentage with one decimal and do not forget a negative sign, if appropriate.) Given the above information, what is the difference between the interest rate on one-year dollar deposits and that on one-year euro deposits (assuming no political risk)? The difference between the dollar interest rate and the euro interest rate R$R= percent. (Give your answer as a percentage with one decimal and do not forget a negative sign, if appropriate.)
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