Question
The Spot rate for USD to JPY is $1 to Y110. The riskless rate of return for 6 months for investing in USD is 2%.
The Spot rate for USD to JPY is $1 to Y110.
The riskless rate of return for 6 months for investing in USD is 2%.
The riskless rate of return for 6 months for investing in JPY is 0.8%.
What is the 6 month Forward Rate of USD to JPY (number of JPY to be received for the payment of $1 6 months from today)?
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Finance for Executives Managing for Value Creation
Authors: Gabriel Hawawini, Claude Viallet
4th edition
9781133169949, 538751347, 978-0538751346
