The nominal interest rate in the U.S. is 5% and the nominal interest rate in Canada is 3%. The spot value of the U.S. dollar is 1 ($/Canadian dollar) and the forward rate is 1.2 ($/Canadian dollar). Calculate the forward discount or premium for the dollar.

Answer rating: 100% (QA)

Forward premiumdiscount Forward rate Spot rate Spot rate x 100 Given values Spot rate S 1 Canadian d... View the full answer