Data for the money market and forex market in the US and UK are given below : London, UK New York, USA Spot Exchange Rate $1.6000/ 0.6250/$ One-year…

/in /by

 Is the forex market in equilibrium now? Respond Yes or No

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Yes

Substantiate your response Yes or No with a mathematical proof

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1/1.6= 0.5250

Based on the following current information from both markets, estimate the forward rate between the two currencies in London, UK.

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Estimate the forward rate in New York, USA

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