Question
The US dollar/Canadian dollar spot exchange rate is $.85/C$. The one year U.S. interest rate is 8% and the one year interest rate in Canada
The US dollar/Canadian dollar spot exchange rate is $.85/C$. The one year U.S. interest rate is 8% and the one year interest rate in Canada is 10%. What is the one-year forward rate that should prevail according to IRP? (Assume the US is the home country and round intermediate steps to four decimals.)
- $.1685/C$
- $.1318/C$
- $.8657/C$
- $.8345/C$
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Calculus Early Transcendentals
Authors: James Stewart
8th edition
1285741552, 9781305482463 , 978-1285741550
