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The Figure Given Below Depicts the Foreign Exchange Market for British

Question 96

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The figure given below depicts the foreign exchange market for British pounds traded for U.S. dollars.Figure 22.2
The figure given below depicts the foreign exchange market for British pounds traded for U.S. dollars.Figure 22.2    -Assume that a one-year Malaysian bond yields 10 percent interest and that the dollar return on maturity is 5 percent. If the exchange rate at maturity is $1 = MYR 4.00 (Malaysian ringgit) , what was the exchange rate at the time the bond was purchased? A) $1 = MYR 4.2 B) $1 = MYR 3.8 C) $1 = MYR 3.6 D) MYR 1 = $0.26 E) MYR 1 = $0.4
-Assume that a one-year Malaysian bond yields 10 percent interest and that the dollar return on maturity is 5 percent. If the exchange rate at maturity is $1 = MYR 4.00 (Malaysian ringgit) , what was the exchange rate at the time the bond was purchased?


A) $1 = MYR 4.2
B) $1 = MYR 3.8
C) $1 = MYR 3.6
D) MYR 1 = $0.26
E) MYR 1 = $0.4

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