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# is this correct= -0.06 Assume the following information: Current spot rate of Australian dollar = \$0.78 Forecasted spot rate of Australian dollar 1...

is this correct= -0.06

Assume the following information:

Current spot rate of Australian dollar = \$0.78

Forecasted spot rate of Australian dollar 1 year from now = \$.83

One-year forward rate of the Australian dollar = \$0.72

Annual interest rate on Australian dollars = .07

Annual interest rate on U.S. dollars = .09

Given the information in this question, the return from covered interest arbitrage by U.S. investors with \$420,000 to invest is about _______

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