The current exchange rate between Canadian dollar (CAD) and Australian dollar (AUD) is 0.89CAD/AUD. The CAD interest
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Question:
The current exchange rate between Canadian dollar (CAD) and Australian dollar (AUD) is 0.89CAD/AUD. The CAD interest rate is 2.85% and AUD interest rate is 1.50%. Assume these interest rates are continuously compounded.
What is the 1.5-yr forward price of CAD in terms of AUD?
A.1.0842 AUD
B.1.0900 AUD
C.1.1010 AUD
D.1.2002 AUD
E.1.0790 AUD
Related Book For
Fundamentals of Financial Management
ISBN: 978-1133541141
13th edition
Authors: Eugene F. Brigham, Joel F. Houston
Posted Date: