Suppose That You Expect During the Next Year the Dollar

question 94

Multiple Choice

Suppose that you expect during the next year the dollar will appreciate against the pound from 0.5 pound to the dollar to 0.75 pound to the dollar. How much will you expect to make on an investment of $10,000 in British government securities that will mature in one year and pay interest of 8%?

• A)-59.5%
• B)-28%
• C)8%
• D)28%

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