EC 500 F - Guías de estudio, Notas de estudios & Resúmenes

Interest Parity Condition Equation - CORRECT ANSWERln(F) - ln(S) = i(countryA) - i(countryB) Interest Parity Condition Definition - CORRECT ANSWERPercentage difference between the forward and spot exchange rates must equal the difference between the interest rates in the two countries. If the one month interest rate in country A is 3% per month and that in country B is 4% per month, the one-month forward rate must be ____________ than the spot rate for the Interest Parity Condition to hold...