An investor in Country-A and one in Country-B invest in 1-year treasuries of the other country.
a. With Interest rate parity, the Country-A investor using covered interest arbitrage will earn the same return as other Country-A investors who invested in the domestic treasury. Comment.
b. With Interest rate parity, the Country-B investor using covered interest arbitrage will earn the same return as other Country-B investors who invested in the domestic treasury. Comment.