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(Solved): 3. Assuming that the interest parity condition holds, what type of information is contained in int ...


3. Assuming that the interest parity condition holds, what type of information is contained in interest rate differentials be

3. Assuming that the interest parity condition holds, what type of information is contained in interest rate differentials between domestic and foreign bonds? Explain.


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Ans. The interest parity condition states that the forward exchange rate should be equal to the spot exchange rate adjusted for the difference in the
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