7. The forecasted value for the Mexican peso is Euro0.1200 and its realized value is Euro0.1000. What is the forecast er
Posted: Sun May 29, 2022 6:24 pm
7. The forecasted value for the Mexican peso is Euro0.1200 and its realized value is Euro0.1000. What is the forecast error (root square error) for the peso? + 8. Suppose that the annual interest rate is 4% in the U.S. and 8% in Germany, and that the spot exchange rate is $1.60/€ and the 180-day forward exchange rate is $1.58/€. Assume that an arbitrager can borrow up to $1,000,000 or €625,000. What should he do? What is the net cash flow (profit)? <>