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when you look at the solution to examples 6,7 how do you come about the 1.0145 and 1.0116 this under chapter 22
You mean chapter 23!
In example 6, you are borrowing US$ and so the interest is 5.8% per year. However since we are borrowing for 3 months, the actual interest is 5.8 / 4 = 1.45%
(or, 0.0145)In example 7, we are depositing US$ and so the interest rate is 6.4% per year. We are only depositing for 3 months and so the actual interest will be 1.6% or 0.016.
(I am sorry but there is a typing error in the answer – it should be 1.016, not 1.0116. The rest of the numbers in the answer are correct).
Have you watched the videos that go with this?
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