Currency Forward Contract/Covered Interest Rate Parity

[melissabt]

In reading 13, page 257 in Book 1 of the Schweser books the Covered Interest Rate Parity equation is
F = [(1+ Ra(days/360))/(1+Rb(days/360))] S0
Where as in reading 47, page 20 in Book 5, the Currency Forward Contract equation is
F = S0[((1 + Rdc)^T) / (1+Rfc)^T]
Does anyone know why one formula multiples the interest rates by the time where the other formula has the time as an exponent?
Thank you for your help!

 

[cpk123]

Covered interest rate parity is using LIBOR rates - so divide by 360.
Currency forward contracts - could also use LIBOR rates - but here Rdc and Rfc are Spot rates of Currency A and B respectively.

 

[S2000magician]

The Econ reading uses nominal rates while the Derivatives reading uses effective rates.
I wrote an article that addresses this: http://financialexamhelp123.com/mark-to-market-value-of-a-currency-forwa...