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You observe the following exchange rates in the newspaper: The 1-month risk-free rate is 0.5% in the US. Part 1 If interest rate parity holds,

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You observe the following exchange rates in the newspaper: The 1-month risk-free rate is 0.5% in the US. Part 1 If interest rate parity holds, what should be the risk-free rate in Europe? If interest rate parity holds, what should be the risk-free rate in Europe? Part 2 If interest rate parity holds, what should be the risk-free rate in Japan? Part 3 If interest rate parity holds, what should be the risk-free rate in the UK

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