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## Statistics

The spot rate of the Australian dollar is \$.62. The 1-year forward rate of the Australian dollar is \$.60. The Australian 1-year interest rate is 9 percent. Assume that the forward rate is used to forecast the future spot rate. Determine the expected effective financing rate for a U.S. firm that borrows Australian dollars to finance its U.S. business.

Statistics and Probability, Statistics

• Category:- Statistics and Probability
• Reference No.:- M91767073

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