How many percent USD overvalued according to UIRP condition

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problem 1: Assume that the one year interest rates for USD and CHF are USD = 5% and CHF = 2% and that the expected spot rate of CHF/USD = 1.12 and that the current spot rate of CHF/USD is 1.04. By how many % is the USD overvalued/undervalued according to UIRP condition?

Reference no: EM132476608

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