Assume That the Swiss Franc Has an Annual Interest Rate

question 29

Multiple Choice

Assume that the Swiss franc has an annual interest rate of 8 percent and is expected to depreciate by 6 percent against the dollar. From a U.S. perspective, the effective financing rate from borrowing francs is:

• A) 8 percent.
• B) 14.48 percent.
• C) 2 percent.
• D) 1.52 percent.

---

Definitions:

Cognitive-behavior Therapists

Mental health professionals who treat various disorders by changing negative thought patterns and behaviors.

Cognitive Therapy

A type of psychotherapy focused on modifying dysfunctional emotions, behaviors, and thoughts by interrogating and uprooting negative or irrational beliefs.

Dysfunctional Thinking

Negative and unhelpful thought patterns that are often irrational and can lead to emotional distress and behavioral problems.

Collaborative Effort

Working together in a joint action or enterprise to achieve a common goal or outcome.