Question
If the current exchange rate between Canadian dollar (CAD) and Australian dollar (AUD) is 0.89CAD/AUD, the CAD interest rate is 2.85%, AUD interest rate is
If the current exchange rate between Canadian dollar (CAD) and Australian dollar (AUD) is 0.89CAD/AUD, the CAD interest rate is 2.85%, AUD interest rate is 1.50%, and these interest rates are continuously compounded, what is the 1.5-yr forward price of AUD?
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Step: 1
To calculate the 15year forward price of AUD we need to use the concept of present value and forward ...
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
13th edition
978-1285027371, 128502737X, 978-1133541141
