Denote the spot euro rate (/$) by S, the forward euro rate (/$) by F, and...
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Denote the spot euro rate (/$) by S, the forward euro rate (/$) by F, and the forward premium by p. The dollar interest rate is denoted by is, which is equivalent of home interest rate, and the euro interest rate is denoted by ie, which is equivalent of foreign interest rate. Which of the following is not a formal statement of IRP for the dollar/euro exchange rate? (1 + i$)/(1 + i) = F/S (1 + i$)/(1 + i) = 1 + p p = (1 + i$)/(1 + i) - 1 (1 + i$)/(1 + i) = 1 - p Denote the spot euro rate (/$) by S, the forward euro rate (/$) by F, and the forward premium by p. The dollar interest rate is denoted by is, which is equivalent of home interest rate, and the euro interest rate is denoted by ie, which is equivalent of foreign interest rate. Which of the following is not a formal statement of IRP for the dollar/euro exchange rate? (1 + i$)/(1 + i) = F/S (1 + i$)/(1 + i) = 1 + p p = (1 + i$)/(1 + i) - 1 (1 + i$)/(1 + i) = 1 - p
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