Suppose that the one-year interest rate is 3.0 percent in the United States, the spot exchange rate between euro and dollar is $1.20/€, and the 9-month futures contracts trade at $1.18/€. What is the no-arbitrage interest rate in Eurozone, implied by these numbers?
You want to learn about the Ferris–wheel riding habits of people, so you ask those leaving a theme park, “How many times did you ride the Ferris wheel today?”
Is the question a statistical question? Explain why or why not.
