Assume That Interest Rate Parity Holds

question 20

Multiple Choice

Assume that interest rate parity holds. The U.S. interest rate is 13 percent and the British interest rate is 10 percent. The forward rate on British pounds exhibits a ____ of ____ percent.​

• A) ​discount; 2.73
• B) ​premium; 2.73
• C) ​discount; 3.65
• D) ​premium; 3.65

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Definitions:

Crimes

Acts or omissions that violate laws prescribing the ways individuals ought to behave, typically punishable by the state.

Society

A group of individuals involved in persistent social interaction, or a large social group sharing the same geographical or social territory, typically subject to the same political authority and dominant cultural expectations.

White-Collar Criminals

Individuals who commit non-violent crimes, usually in commercial situations, for financial gain through deceit or fraud.

Federal Laws

Laws created by the federal government of a country, applicable nationwide and overriding state laws where conflict exists.