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If the Forward Rate for a Currency Is Less Than

question 32

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If the forward rate for a currency is less than the spot rate for that currency, the forward rate is said to exhibit a premium.


Definitions:

John Reed

An American journalist, poet, and socialist activist, best known for his first-hand account of the Bolshevik Revolution, "Ten Days That Shook the World."

Capitalism

An economic system based on private ownership of the means of production and their operation for profit, characterized by free markets, the accumulation of capital, and competition.

Norman Angell

British journalist, author, and Nobel Peace Prize laureate, best known for his work "The Great Illusion," which argued that the economic interdependence of nations would make war futile.

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