Suppose the Spot Rates for the Pound, Mark, and Swiss

question 8

Multiple Choice

Suppose the spot rates for the pound, mark, and Swiss franc are $1.20, $.32, and $.40, respectively. The associated 90?day interest rates (annualized) are 16%, 8%, and 4%, while the U.S. 90?day interest rate is 12%. What is the 90?day forward rate (to the nearest cent) on a TCU (TCU 1 = £1 + DM1 + SFr1) if interest parity holds?

• A)$1.92
• B) $1.98
• C) $1.94
• D) $1.87

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Protection or coverage provided by a governmental entity as opposed to private insurance companies, often for health, employment, or social welfare purposes.

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A contract between an individual or employer and an insurance company to cover part or all of the healthcare expenses incurred by the insured.

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