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The French Franc Is Currently Worth $0

Question 88

Multiple Choice

The French franc is currently worth $0.24 and it's selling in the one-year forward market at a 10% premium relative to the Canadian Dollar.Approximately what rate would you expect to pay for a one-year loan in France if the rate would be 10% in Canada?


A) 10.00%
B) 11.62%
C) 14.55%
D) 20.00% 1.1 x 4.167 = 4.583

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