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Question
Suppose that the one-year U.S. interest rate is 4% and the one-year U.K. interest rate is 6%. If the current spot rate is $1.80 per pound, what must the one-year forward rate ($/pound) be according to the approximate covered interest parity?
a. 1.360
b. 1.764
c. 1.836
d. 1.980
Answer
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Related questions
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