Suppose a bank quotes S = $1.1045/€. The annualized risk-free interest rates are 4% and 6%...

Suppose a bank quotes S = $1.1045/€. The annualized risk-free interest rates are 4% and 6% in the U.S and Germany, respectively. Find the approximate forward rate for the euro. Do not write any symbol. Make sure to round your answers to the nearest 100th decimal points. For example, write 1.2345 for $1.2345/€.

Suppose a bank quotes $/€ = 1.1045-1.1506. What is the bid-ask spread in percentage? Do not write any symbol. Express your answers as a percentage. Make sure to round your answers to the nearest 100th decimal points. For example, write 12.34 for 12.34%.

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milcah answered 1 year ago

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