Suppose you observe the following spot and forward exchange rates between the U.S. dollar ($) and the Canadian dollar (C$): Spot Exchange Rate 0.8842 One-Year Forward Exchange Rate 0.9001 Canadian dollar (U.S. dollar/Canadian dollar) The current one-year interest rate on U.S. Treasury securities is 6.35%. If interest rate parity holds, what is the expected yield on one-year Canadian securities of equal risk? O 4.47% O 5.14% 4.25% O 4.02% Interest rate parity recognizes that when you invest in a country other than your home country, two factors affect your investment-returns on the investment itself and changes in the exchange rate. Which of the following would cause the overall return on your investment to be lower than the investment's stated return? Your home currency appreciates relative to the currency in which the investment is denominated O The currency in which the investment is denominated appreciates relative to your home currency. Your home currency depreciates relative to the currency in which the investment is denominated. Suppose you observe the following spot and forward exchange rates between the U.S. dollar ($) and the Canadian dollar (C$): Spot Exchange Rate 0.8842 One-Year Forward Exchange Rate 0.9001 Canadian dollar (U.S. dollar/Canadian dollar) The current one-year interest rate on U.S. Treasury securities is 6.35%. If interest rate parity holds, what is the expected yield on one-year Canadian securities of equal risk? O 4.47% O 5.14% 4.25% O 4.02% Interest rate parity recognizes that when you invest in a country other than your home country, two factors affect your investment-returns on the investment itself and changes in the exchange rate. Which of the following would cause the overall return on your investment to be lower than the investment's stated return? Your home currency appreciates relative to the currency in which the investment is denominated O The currency in which the investment is denominated appreciates relative to your home currency. Your home currency depreciates relative to the currency in which the investment is denominated