Business, 18.10.2019 20:30 megababe04

Suppose that the one-year interest rate is 5.0 percent in the united states; the spot exchange
rate is $1.20/€; and the one-year forward exchange rate is $1.16/€. what must the one-year
interest rate be in the euro zone to avoid arbitrage?
a) 5.0%
b) 6.09%
c) 8.62%
d) none of the options

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Suppose that the one-year interest rate is 5.0 percent in the united states; the spot exchange

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