Assume that interest rate parity holds. When a currency trades at a forward premium,what does that imply about domestic rates relative to foreign interest rates? When acurrency trades at a forward discount?
Assume that interest rate parity holds. When a currency trades at a forward premium,what does that imply about domestic rates relative to foreign interest rates? When acurrency trades at a forward discount?
Chapter21: International Cash Management
Section: Chapter Questions
Problem 5ST
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Assume that interest rate parity holds. When a currency trades at a forward premium,
what does that imply about domestic rates relative to foreign interest rates? When a
currency trades at a forward discount?
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