If interest rate parity exists, then the rate of return achieved from covered interest arbitrage should be equal to the interest rate available in the foreign country.

Name: If interest rate parity exists, then the rate of return achieved from covered interest arbitrage should be equal to the interest rate available in the foreign country.
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Interest rate parity implies that the rate of return from covered interest arbitrage should be equal to the domestic interest rate, not the foreign interest rate.

If Interest Rate Parity Exists, Then the Rate of Return