US BASED INVESTOR 1776
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A US based investor can buy a US bond or an Australian bond. The US bond pays 9% interest and the Australian bond pays 5% interest. If the current exchange rate is Et = 1.5 and the future exchange rate is Et+1 = 1.4, then in terms of US dollars Answer the US bond has a higher future value the Australian bond has a higher future value both bonds have the same future value none of the above
- 8 years ago