The present exchange rate is c1 us77 the 1 year

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37. The present exchange rate is C$1 = US$.77. The 1-year futures rate is C$1 = US$.73. The yield on a 1-year U.S. bill is 4%. A yield of __________ on a 1-year Canadian bill will make investors indifferent between investing in the U.S. bill and the Canadian bill. AACSB: Analytical Thinking Blooms: Apply Difficulty: 2 Medium Learning Objective: 19-02 Formulate hedge strategies to offset the currency risk involved in international investments. Topic: Risk Factors in International Investing
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  • Spring '16
  • Exchange Rate, Foreign exchange market, United States dollar

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