The relationship between interest rates and exchange rates can be represented through the concept of interest rate parity. Consider the following: An American investor is considering investing dollar 1,000 in default-free 90-day Japanese bonds that promise a 3 percentage annual nominal return. The spot exchange rate is 104.79 per dollar. The 90-day forward exchange rate is 103.55 per dollar. What would be the investor's annualized return on these bonds if he or she can lock in the dollar return by selling the foreign currency in the forward market? 8.998 percentage 7.824 percentage 6.259 percentage 7.433 percentage