Question: Question 2 Explain the difference between UIP and CIP, and specifically how CIP leads to UIP. When there is a forward discount, what condition must

Question 2

  1. Explain the difference between UIP and CIP, and specifically how CIP leads to UIP.

  1. When there is a forward discount, what condition must be true (in CIP or UIP)? Explain how that condition leads to a forward discount.

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