Suppose interest rate parity holds and the current

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Use the information below to answer the following questions. 


Currency per U.S. $
Canada dollar 1.2389
6-months forward 1.2344
Japan Yen 100.4500
6-months forward 99.9300
U.K. Pound 0.6797
6-months forward 0.6776

Suppose interest rate parity holds, and the current risk-free rate in the United States is 3 percent per six months.

What must the six-month risk-free rate be in Canada?

Reference no: EM13478645

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