Suppose the spot and six-month forward rates on the south, Ask an Expert

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Suppose the spot and six-month forward rates on the South Korean won are SKW 1,304.86 and SKW 1,315.06, respectively. The annual risk-free rate in the United States is 3 percent, and the annual risk-free rate in South Korea is 6 percent.

What must the six-month forward rate be to prevent arbitrage? (Do not include the South Korean won sign (SKW). Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.)

Forward rate SKW

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92311765

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