If a Currency Is Selling at a Forward Premium It

question 125

Multiple Choice

If a currency is selling at a forward premium it most likely means that the foreign-exchange market believes that the ________.

• A) currency will depreciate over time
• B) country's economy is weak
• C) currency will appreciate over time
• D) country's economy is strong

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Definitions:

Commercial Speech

Forms of speech or messaging done on behalf of a company or individual for the intent of making a profit, and is subject to regulation and protection under various legal doctrines.

First Amendment

An amendment to the U.S. Constitution that safeguards freedoms including speech, religion, assembly, and the press from governmental restrictions.

Misleading

Information or statements that give a false idea or impression, leading others to believe something that is not true.

Indirect Taxes

Taxes levied on goods and services rather than on income or profits, such as sales tax or VAT.