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Theoretical Relationship # 4: Relationship between Interest Rates and Exchange Rates; Interest Rate Parity Illustrate the concept of Interst Rate Parity and Covered Interest Arbitrage

Theoretical Relationship # 4: Relationship between Interest Rates and Exchange Rates; Interest Rate Parity

Illustrate the concept of Interst Rate Parity and Covered Interest Arbitrage with a numerial example.

What are the implications of this for Foreign Exchange Market.?

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