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    International Financial Management Study Set 1
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    Exam 7: International Arbitrage and Interest Rate Parity
  5. Question
    To Capitalize on High Foreign Interest Rates Using Covered Interest
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To Capitalize on High Foreign Interest Rates Using Covered Interest

Question 35

Question 35

True/False

To capitalize on high foreign interest rates using covered interest arbitrage, a U.S. investor would convert dollars to the foreign currency, invest in the foreign country, and simultaneously sell the foreign currency forward.

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