Suppose the spot rate on the Canadian dollar is Can$1.023.The risk-free nominal rate in the United States is 2.6 percent while it is 3.25 percent in Canada.Which one of the following 1-year forward rates best establishes the approximate interest rate parity condition?
A) Can$1.0296
B) Can$1.0164
C) Can$1.0552
D) Can$1.0867
E) Can$1.0923
Correct Answer:
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