If the positive interest rate differential in favor of a foreign monetary center is 4 percent per

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If the positive interest rate differential in favor of a foreign monetary center is 4 percent per year and the foreign currency is at a forward discount of 2 percent per year, roughly how much would an interest arbitrageur earn from the purchase of foreign three‐month treasury bills if he or she covered the foreign exchange risk?
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International Economics

ISBN: 978-1118955765

12th edition

Authors: Dominick Salvatore

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