The yield on a 1 year bill in the united kingdom is 6

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38. The yield on a 1-year bill in the United Kingdom is 6%, and the present exchange rate is 1 pound = US$2. If you expect the exchange rate to be 1 pound = US$1.95 a year from now, the return a U.S. investor can expect to earn by investing in U.K. bills is approximately __________. 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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