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The exchange rate between the Canadian and U.S. dollar today is US $1=CDN $1.545. Canadian continuously compounded risk-free interest rate is 6%, 1 year maturity.

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The exchange rate between the Canadian and U.S. dollar today is US $1=CDN $1.545. Canadian continuously compounded risk-free interest rate is 6%, 1 year maturity. As of today, the no- arbitrage one year forward contract on U.S. dollars has a delivery price of CDN $1.540. (a) Show that the implied continuously compounded one-year risk-free rate in the U.S. is 6.32%

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