Assume the spot exchange rate for the Swiss franc is CHF0.90 = USD1 and the 1-year forward rate is CHF0.871 = USD1.If the 1-year interest rate in the U.S.is 5%,what is the 1-year interest rate in Switzerland?
A) 2.00%
B) 1.62%
C) 1.50%
D) 1.33%
Correct Answer:
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