What must the six-month risk-free rate be in japan

Assignment Help Financial Management

Reference no: EM132041767

Use the information below to answer the following questions.

	Currency per U.S. $
Australia dollar	1.2374
6-months forward	1.2359
Japan yen	100.3000
6-months forward	100.0800
U.K. pound	.6795
6-months forward	.6778

Suppose interest rate parity holds, and the current risk-free rate in the United States is 5 percent per six months. Use the approximate interest rate parity condition to answer this question.

What must the six-month risk-free rate be in Australia? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Risk-free rate             %

What must the six-month risk-free rate be in Japan? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Risk-free rate             %

What must the six-month risk-free rate be in Great Britain? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Risk-free rate             %

Reference no: EM132041767

Questions Cloud

How many polish zlotys can you get : If you have $100, how many Polish zlotys can you get? (Do not include the Polish zlotys sign (Z).

What is the state of the us economy : Assign a probability to each alternative and calculate an expected value for each alternative. Which alternative has the highest expected value?

Calculate the average returns for x and y : Calculate the standard deviations for X and Y. Calculate the variances for X and Y.

Calculate the cross-rate for british pounds : Which would you rather have, $100 Canadian or £100? What is the cross-rate for Canadian dollars in terms of British pounds?

What must the six-month risk-free rate be in japan : Suppose interest rate parity holds, and the current risk-free rate in the United States is 5 percent per six months.

Which of the two funds appears to have more eol : What is the EMV for the fund in part A? How much of an increase can be obtained by following the recommendation of part B?

Find the degree of financial leverage of rat race home : Average selling price per unit $340. Variable cost per unit $187 Units sold 359 Fixed costs $9,499 Interest expense $19,307

How much should be recorded for the value of the warrants : Logan Company issued $300,000 of 7% bonds at 103. Included in this package sale were twenty detachable stock warrants attached to each $1,000 bond.

What is the change in gross fixed assets : The firm has 1,000 shares outstanding. Free Cash Flow to the Firm will grow at 2% and the Free Cash Flow to Equity will grow at 7% forever.

User Account

All Pages