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The one-year risk-free rate in the U.S. is 5.140 percent and the one-year risk-free rate in Mexico is 7.74 percent. The one-year forward rate between
The one-year risk-free rate in the U.S. is 5.140 percent and the one-year risk-free rate in Mexico is 7.74 percent. The one-year forward rate between the Mexican peso and the U.S. dollar is MXN12.431/$. What is the spot exchange rate? Assume interest rate parity holds. Multiple Choice O MXN12.431/$ MXN14.001/$ MXN12.738/$ MXN12.131/S MXN14.971/$
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