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The spot rate for the Japanese yen currently is 106 per $1. The one-year forward...

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Finance

The spot rate for the Japanese yen currently is 106 per $1. The one-year forward rate is 105 per $1. A risk-free asset in Japan is currently earning 5 percent. If interest rate parity holds, approximately what rate can you earn on a one-year risk-free U.S. security?image

74. The spot rate for the Japanese yen currently is 106 per $1. The one-year forward rate is $105 per $1. A risk-free asset in Japan is currently earning 5 percent. If interest rate parity holds, approximately what rate can you earn on a one-year risk-free U.S. security? A. 6.00% B. 6.12% C. 6.20% D. 6.25% E. 6.33%

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