Suppose That If No Other Information Is Available, What Will Your Guess

Suppose that: $$\begin{array}{l}\begin{array} {lll } \text {U.K. (pound) }&\frac { \text { Spot Rate } } { 1.5331 }&\frac { 3 \text { Month Forward Rate } } { 1.5372 }&\frac { 1 \text { Year Forward Rate } } { 1.5502 }\end{array}\end{array}$$ If no other information is available, what will your guess about the spot rate in one year be?

A) 1.5331
B) 1.5372
C) 1.5502
D) 2.0000

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free