Question:

Suppose the US interest rate is 3% per annum. The ₹-$ exchange rate in spot market is 80 and in 3-month forward market is 81. What is the per annum return on US bond in rupee terms?

Updated On: Jan 28, 2025

4.25%
8%
1.75%
-2%

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The Correct Option is B

Solution and Explanation

The correct option is(B): 8%

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