The Spot Rate on the Hong Kong Dollar Is 7

question 58

Multiple Choice

The spot rate on the Hong Kong dollar is 7.75.Interest rates in Hong Kong are expected to be 6 percent while they are anticipated to be 3 percent in the U.S.What is the expected exchange rate two years from now?

• A)HK$7.9825
• B)HK$8.1808
• C)HK$8.2220
• D)HK$8.3778
• E)HK$8.4141

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