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The spot rate between Japan and the U.S. is 100.37 = $1, while the one-year forward rate is 99.97 = $1. A one-year risk-free security

The spot rate between Japan and the U.S. is 100.37 = $1, while the one-year forward rate is 99.97 = $1. A one-year risk-free security in the U.S. is yielding 3.8 percent. What is the rate of return on a one-year risk-free security in Japan assuming that interest rate parity exists?

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