If the Spot Rate Between the U

question 57

Multiple Choice

If the spot rate between the U.S. dollar and the Brazilian real is $1 = 2.5698 real and the 3-month forward rate is $1 = 2.9841 real, is the forward real selling at a discount or a premium?

• A) Discount
• B) Premium
• C) Unable to determine with the cross-rates

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