A. We know that the yen and the swiss franc have a 170yen/ sf 1...
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A. We know that the yen and the swiss franc have a 170yen/ sf 1 exchange rate, meaning one swiss franc buys 170 yen in the spot ER market. The 1 year forward rate is 180 yen /swiss franc, or 1 franc buys 180 yen in the forward market. If the swiss franc has an interest rate of .06, what should the yen rate be for IPT (interest parity theory) to be attained? Show everything in yen and swiss franc terms.
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