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A US Investor Bought a One-Year French Security for €10,000 and and Received

Question 3

Multiple Choice

A U.S. investor bought a one-year French security for €10,000 and received €10,550 at the end of the year. The exchange rate on the date the investment was made was $0.87265/€ and the rate on the date it matured was $1.27244/€. The dollar-equivalent rate of return was


A) +53.83%
B) +27.65%
C) +5.50%
D) -27.65%
E) -53.83%

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