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Question
Suppose that the one-year U.S. interest rate is 9% and the one-year U.K. interest rate is 8%. If the current spot rate is $1.70 per pound, what must the one-year forward rate ($/pound) be according to the approximate covered interest parity?
a. $1.683
b. $1.717
c. $1.723
d. $3.400
Answer
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Related questions
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