Currently interest rate in the us is 3 and interest rate in, Ask an Expert

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Currently, Interest rate in the US is 3% and interest rate in Japan is 5%.

According to the IRP, which of the following is correct?

A. in forward market, the value USD should be higher than the value of USD in spot market by about 2%.

In other words, USD should exhibit a forward premium of about 2% over JPY

B. in forward market, the value JPY should be higher than the value of JPY in spot market by about 2%.

In other words, JPY should exhibit a forward premium of about 2% over JPY

C. the value of USD in spot market will rise by about 2% against JPY in the future.

D. the value of JPY in spot market will rise by about 2% against USD in the future.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92312967

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