Question
You are given the following data: i = 3%, i* = 1%, Se = 1.4 ($ per ). a) Write down the uncovered interest
You are given the following data: i = 3%, i* = 1%, Se = 1.4 ($ per ). a) Write down the uncovered interest rate parity equilibrium relationship in its exact form. b) Write down the uncovered interest rate parity equilibrium relationship in its approximate form. c) Write down the expression for the equilibrium spot rate. d) Calculate the equilibrium spot rate given the above data.
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