Assume that the three-month forward rate for the euro is $1.367 and the spot rate is $1.364. What is the forward premium or discount on the euro?
a. 0.88% premium
b. 0.88% discount
c. 0.23% premium
d. 0.23% discount
Answer: a.
Assume that the three-month forward rate for the euro is $1.367 and the spot rate is $1.364. What is the forward premium or discount on the euro?
a. 0.88% premium
b. 0.88% discount
c. 0.23% premium
d. 0.23% discount
Answer: a.