A 80,000 Czech Koruna with a 5000 Koruna coupon is trading for 80,500 Koruna, and 12,000 Euro Bill with a 200 Euro coupon is trading at 11,900 Euro. Both mature in 1 year.

If uncovered interest parity holds, the market believes the Koruna will depreciate against the Euro by approximately _____ % in a years’ time. 

Answer rating: 100% (QA)

Heres the analysis to determine the implied depreciation of the Koruna against the Euro assuming unc... View the full answer