The 90-Day Forward Rate for the Euro Is $1

question 74

Multiple Choice

The 90-day forward rate for the euro is $1.07, while the current spot rate of the euro is $1.05. What is the annualized forward premium or discount of the euro?

• A) 1.9 percent discount
• B) 1.9 percent premium
• C) 7.6 percent premium
• D) 7.6 percent discount

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Definitions:

Discrimination

The unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, or gender.

Wintergreen

A plant or flavoring that has a characteristic minty taste, often used in candies and medicinal products.

Oil of Cloves

An essential oil derived from clove trees, used medicinally for its pain-relieving properties, especially in dentistry, and for its aromatic qualities.

Contingency View

The contingency view is a theory that suggests the best way to organize or lead an organization varies depending on the internal and external situation or context.