The 6-Month Forward Quote for the Euro Is €1

question 72

Multiple Choice

The 6-month forward quote for the euro is €1.6/US$,and the spot price of the euro is €1.7/US$.Which of the following statements is true?

• A) Forward discount on the euro is 6.25%.
• B) Forward premium on the euro is 6.25%.
• C) Forward discount on US$ is 6.25%.
• D) Forward premium on US$ is 6.25%.

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