What is the effective dollar interest rate from investing

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Reference no: EM133007224

Question: You observe that the current USD/GBP spot rate is $1.22/GBP and the USD/GBP one year forward rate today is $1.44/GBP. You can invest in the US at 8.8% per annum or in UK at 4.3% per annum.

From the US perspective, what is the effective dollar interest rate from investing in the US for one year? Submit your final answer as a percentage rounded to two decimal places (Ex. 0.00%)

Reference no: EM133007224

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