If the exchange rate at time t is Et = €1/$. You invest $1 in an euro asset at t, which has an interest of 8%. When the asset expires at t+1, you get paid € (x.xx round to two decimal places). If...




If the exchange rate at time t is Et = €1/$.   You invest $1 in an euro asset at t, which has an interest of 8%.  When the asset expires at t+1, you get paid €            (x.xx round to two decimal places).  If dollar appreciates by 2 % against euro, that is, Et+1 = €_______/$(x.xx round to two decimal places), then you can buy back $                (x.xx round UP to two decimal places).





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Jun 09, 2022
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