FindFind

International Financial Management

14th Edition
Madura
Publisher: Cengage
ISBN: 9780357130698
FindFind

International Financial Management

14th Edition
Madura
Publisher: Cengage
ISBN: 9780357130698

Solutions

Chapter 7, Problem 30QA
Textbook Problem

Testing IRP The one-year interest rate in singapore is 11 percent. The one-year interest rate in the United States is 6 percent. The spot rate of the singapore dollar (SS) is $0.50 and the forward rate of the S$ is $0.46. Assume zero transaction costs.

  1. Does interest rate parity exist?
  2. Can a U.S. firm benefit from investing funds in singapore using covered interest arbitrage?

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