What must the six-month forward rate be to prevent arbitrage

Reference no: EM13265756

Suppose the spot and six-month forward rates on the South Korean won are SKW 1,128.16 and SKW 1,130.24, respectively. The annual risk-free rate in the United States is 2.5 percent, and the annual risk-free rate in South Korea is 3.1 percent. (Enter your answer as directed, but do not round intermediate calculations.)

Required:

What must the six-month forward rate be to prevent arbitrage?

Reference no: EM13265756

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