Question
Suppose the spot and six-month forward rates on the Norwegian krone are Kr 5.83 and Kr 5.98, respectively. The annual risk-free rate in the United
| Suppose the spot and six-month forward rates on the Norwegian krone are Kr 5.83 and Kr 5.98, respectively. The annual risk-free rate in the United States is 3.63 percent, and the annual risk-free rate in Norway is 5.33 percent. |
| The six-month forward rate on the Norwegian krone would have to be how much Kr/$ to prevent arbitrage? |
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Fundamentals Of Futures And Options Markets
Authors: John C. Hull
7th Edition
0136103227, 9780136103226
