Suppose the spot and six-month forward rates

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Suppose the spot and six-month forward rates on the Norwegian krone are Kr 5.82 and Kr 5.97, respectively. The annual risk-free rate in the United States is 3.62 percent, and the annual risk-free rate in Norway is 5.32 percent. Using the approximation, the six-month forward rate on the Norwegian krone would have to be Kr/$ to prevent arbitrage. (Do not round intermediate calculations. Round your answer to 4 decimal places, e.g., 32.1616.)

Reference no: EM131915076

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