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netineya
1 month ago
11

Use interest rate parity to answer this question. A U.S. investor has a choice between a risk minus free one minus year U.S. sec

urity with an annual return of​ 4%, and a comparable British security with a return of​ 5%. If the spot rate is ​$1.43/pound​, the forward rate is ​$1.44/pound​, and there are no transaction​ costs, the investor should invest in the U.S. security. True or false?
Business
1 answer:
marusya05 [3.7K]1 month ago
3 0
This statement is inaccurate.
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