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QUESTION
The Argentine one-year CD (deposit) rate is 13%, while the Mexico one-year CD rate is 11% and the U. one-year CD rate is 6%. All CDs have zero...
The Argentine one-year CD (deposit) rate is 13%, while the Mexico one-year CD rate is 11% and the U.S. one-year CD rate is 6%. All CDs have zero default risk. Interest rate parity holds, and you believe that the international Fisher effect holds. •
