Assume the Spot Rate for the Japanese Yen Currently Is

question 12

Multiple Choice

Assume the spot rate for the Japanese yen currently is ¥99.31 per $1 and the one-year forward rate is ¥97.62 per $1.A risk-free asset in Japan is currently earning 2.5 percent.If interest rate parity holds,approximately what rate can you earn on a one-year risk-free U.S.security?

• A)1.63 percent
• B)2.11 percent
• C)4.20 percent
• D)4.96 percent
• E)5.01 percent

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A financial statement that groups assets, liabilities, and equity into subcategories, providing detail and clarity to financial positions.

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