The spot rate for the Japanese yen currently is ¥121 per $1. The one-year forward rate is ¥120 per $1. A risk-free asset in Japan is currently earning 5 percent. If interest rate parity holds, what rate can you earn on a one-year risk-free U.S. security?
5.83 percent
4.13 percent
5.88 percent
4.18 percent
5.93 percent