Business, 04.04.2020 12:51 sryun

Assume that interest rate parity holds. The U. S. five‑year interest rate is 5% annualized, and the Mexican five‑year interest rate is 8% annualized. Today’s spot rate of the Mexican peso is $.20. What is the approximate five‑year forecast of the peso’s spot rate if the five‑year forward rate is used as a forecast?

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Assume that interest rate parity holds. The U. S. five‑year interest rate is 5% annualized, and the...

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