Use Figure 21.1 to answer the following questions. Suppose interest rate parity holds, and the current six month risk-free rate in the United States is 1.3 percent. Use the approximate interest rate parity equation to answer the following questions. a. What must the six-month risk-free rate be in Great Britain? (Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What must the six-month risk-free rate be in Japan? (Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What must the six-month risk-free rate be in Switzerland? (Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Great Britain risk-free rate % b. Japanese risk-free rate % c. Swiss risk-free rate

Use Figure 21.1 to answer the following questions. Suppose interest rate parity holds, and the current six month risk-free rate in the United States is 1.3 percent. Use the approximate interest rate parity equation to answer the following questions. a. What must the six-month risk-free rate be in Great Britain? (Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What must the six-month risk-free rate be in Japan? (Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What must the six-month risk-free rate be in Switzerland? (Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Great Britain risk-free rate b. Japanese risk-free rate c. Swiss risk-free rate % % Figure 21.1 Exchange Rate Quotations in USS per USS .0167 2191 -760B 001267 .060297 1 .0532 .02678 60.0116 4.106 1.3145 777.3 3365.07 18.2872 37.34 Country/currency Americas Argentina peso Brasil real Canada dollar chile peso Colombia peso Ecuador us dollor Mexico peso Uruguay peso Asia-Pacific Australian dollar 1 month 3 month 6 month China yuan Hong Kong dollar India rupee Indonesia rupiah Japan yen 1 month 3 month month Kazakhstan tenge Macau pataca Malaysia ringgit New Zealand dollar Pakistan rupee Philippines Peso Singapore dollar South Korea won Sri Lanka rupee Taiwan dollar Thailand baht Vietnam Europe Bulgaria lev Croatia kuna Czech Republic koruna Denmark Krone Euro area euro Hungary Forint Iceland Krona Norway Krone Poland sloty Romania leu Russia ruble Sweden krona Switzerland trane 1 month month 6 month Turkey Tira Ukraine hryvnia UK pound 1 month 3 month 6 month Middle East Africa Bahrain dimar Egypt pound Israel shekel Kuwait Dinar Oman sul rial Qatar rial Saudi Arabia Riyal South Africa rand .6825 .6822 .6813 .6799 .1442 . 1207 01402 .0000737 .00915 20095 200915 00915 .00264 1240923 .246 .6667 0060 .0197 - 7400 .0000546 20055063 .03328 .03272 .000 1.4652 1.4659 1.4678 1.4708 6.9367 2725 71.316 13573 109.28 109.29 109.30 109.11 378.6 0.007 4.0655 1.5135 154.63 50.B01 1.3514 1170.2 181.61 30.05 30.56 23123 1.776 +56382 . 1401 .04301 22.827 6.778 .9070 304.96 124.61 9.044 3.8614 1.1026 00327912 -008025 . 1105 .259 .2306 201611 . 1045 1.0297 1.0317 1.0356 1.0418 .1684 .0407 1.3074 1.3662 1.3049 1.3038 62.0 9.5669 -9712 .9693 .9654 .9599 5.9391 24.5652 .7649 7656 7663 2767 2.6529 .0633 .2894 3.2912 2.5974 .2747 .3769 15.8006 3.455 .30 39 3.600 3.75117 14.392 - 2665 0695