The spot rate of the euro is quoted at $1.29. The annualized forward premium on the euro is 10%. What is the 30-day forward rate of the euro?

Name: The spot rate of the euro is quoted at $1.29. The annualized forward premium on the euro is 10%. What is the 30-day forward rate of the euro?
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Question

Quizplus · Accepted Answer

Using the formula: 
Forward Rate = Spot Rate * (1 + Forward Premium/12)
Forward Rate = 1.29 * (1 + 0.1/12)^1
Forward Rate = $1.30 rounded to the nearest cent.

The Spot Rate of the Euro Is Quoted at $1