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(URGENT) Please help! tysm! Suppose the exchange rate is such that KRW 1,400 = USD 1 currently. In the foreseeable future, the interest rate in
(URGENT) Please help! tysm!
Suppose the exchange rate is such that KRW 1,400 = USD 1 currently. In the foreseeable future, the interest rate in South Korea is expected to be 2.9% while in the US it is going to be 2.2%. 4.1. If the forex market is offering a 1-year forward contract with the exchange rate KRW Z = USD 1, find Z so that there is no arbitrage opportunity. [5 points] 4.2. If the forward exchange rate is KRW 1419.59= USD 1.00, show how you can exploit an arbitrage opportunity to make riskless profit. [ 5 points] Step by Step Solution
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