Question: 1 8 . Suppose that the one - year interest rate is 4 . 0 percent in Italy. The spot exchange rate is $ 1
Suppose that the oneyear interest rate is percent in Italy. The spot exchange rate is $E and the oneyear forward exchange rate is $ What must the oneyear interest rate be in the United States to avoid arbitrage opportunities?
A
B
C
D none of the options in this question
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