Assume the current U.S. dollar-British spot rate is 0.6927/$. If the current nominal one-year interest rate in

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Assume the current U.S. dollar-British spot rate is 0.6927£/$. If the current nominal one-year interest rate in the U.S. is 5% and the comparable rate in Britain is 6%, what is the approximate forward exchange rate for 360 days?

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Corporate Financial Management

ISBN: 978-0273758839

5th edition

Authors: Glen Arnold

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Posted Date: May 07, 2023 11:29 PM

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Assume the current U.S. dollar-British spot rate is 0.6927/$. If the current nominal one-year interest rate in

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SOLUTION To calculate the forward exchange rate we need to use the following formula Forward Rate Spot Rate x 1 Interest Rate of Domestic Currency 1 I... View the full answer

Corporate Financial Management

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