Question
The treasurer of a major U.S. firm has $30 million to invest for three months. The interest rate in the United States is .31 percent
The treasurer of a major U.S. firm has $30 million to invest for three months. The interest rate in the United States is .31 percent per month. The interest rate in Great Britain is .34 percent per month. The spot exchange rate is .573, and the three-month forward rate is .575. Ignoring transaction costs, in which country would the treasurer want to invest the companys funds? Why?
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Small Business Management Launching and Growing New Ventures
Authors: Justin Longenecker, Leo Donlevy, Terri Champion, William Petty, Leslie Palich, Frank Hoy
6th Canadian edition
176532218, 978-0176532215
