Assume the following information: You have $2,000,000 (US dollars) to invest: Current spot rate of euro...
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Assume the following information: You have $2,000,000 (US dollars) to invest: Current spot rate of euro = $1.30 1-year forward rate of euro = $1.25 1-year deposit rate in U.S. = 11% 1-year deposit rate in Europe = 14% If you use covered interest arbitrage for a 1-year investment, what will be the amount of U.S. dollars you will have after one year? (Points : 3.5) -$2,192,307.69. -$2,371,200.00. -$3,672,500.00. -$1,403,076.92. Assume the following information: You have $2,000,000 (US dollars) to invest: Current spot rate of euro = $1.30 1-year forward rate of euro = $1.25 1-year deposit rate in U.S. = 11% 1-year deposit rate in Europe = 14% If you use covered interest arbitrage for a 1-year investment, what will be the amount of U.S. dollars you will have after one year? (Points : 3.5) -$2,192,307.69. -$2,371,200.00. -$3,672,500.00. -$1,403,076.92.
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