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The spot rate for the British pound currently is .55 per $1. The one-year forward...

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Finance

The spot rate for the British pound currently is .55 per $1. The one-year forward rate is .58 per $1. A risk-free asset in the U.S. is currently earning 3 percent. If interest rate parity holds, approximately what rate can you earn on a one-year risk-free British security?

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75. The spot rate for the British pound currently is .55 per $1. The one-year forward rate is .58 per $1. A risk-free asset in the U.S. is currently earning 3 percent. If interest rate parity holds, approximately what rate can you earn on a one-year risk-free British security? A. 4.01% B. 4.31% C. 6.22% D. 6.87% E. 8.62%

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