How could cooper potentially improve its method

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Reference no: EM133522533

Problem 1 - G

Assume that the forward rate and the spot rate of the Mexican peso are usually similar at a given point in time. Assume that the peso has depreciated consistently and substantially over the last three years. Would the forward rate have been biased over this period? If so, would it typically have overestimated or underestimated the future spot rate of the peso (in dollars)? Explain.

Problem 2 - I

FORECASTING THE EURO Cooper, Inc., a U.S.-based MNC, periodically obtains euros to purchase German products. It assesses U.S. and German trade patterns and inflation rates to develop a fundamental forecast for the euro. How could Cooper potentially improve its method of fundamental forecasting as applied to the euro?

 

Reference no: EM133522533

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