A japanese investor can earn a 2 risk-free rate of return, Ask an Expert

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A Japanese investor can earn a 2% risk-free rate of return in Japan or a 4.5% risk-free rate of return in the United States.

If the spot exchange rate is ¥101/$, what is the one-year forward rate that will make an investor indifferent between the U.S. and the Japanese investments?

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Financial Management, Finance

Category:- Financial Management
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