The one-year forward rate between the U.S.and Japan is ¥122.47 = $1.A one-year risk-free security in Japan is yielding 5.3 percent while it is 4.6 percent in the U.S.Assume interest rate parity exists.What is the spot rate between the U.S.and Japan?
A) ¥120.41
B) ¥121.08
C) ¥121.66
D) ¥121.94
E) ¥122.03
Correct Answer:
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