question archive The Mexican one-year interest rate is 9 percent, while the U
The Mexican one-year interest rate is 9 percent, while the U
Subject:FinancePrice: Bought3
The Mexican one-year interest rate is 9 percent, while the U.S. one-year interest rate is 3 percent. Assume that interest rate parity exists. If a U.S. firm uses the forward rate to forecast the exchange rate of the peso in one year, the expected effective yield from investing in a one-year deposit in Mexico is:?
6%
12%
none of the options listed
3%
9%
