The Spot Rate for the British Pound Currently Is £

question 251

Multiple Choice

The spot rate for the British pound currently is £.57 per $1. The one-year forward rate is £.58 per $1. A risk-free asset in Canada is currently earning 2.5 percent. If interest rate parity holds, what rate
Can you earn on a one-year risk-free British security?

• A) 4.18 percent
• B) 4.30 percent
• C) 4.86 percent
• D) 5.10 percent
• E) 5.42 percent

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Definitions:

Malnutrition

A condition that results from eating a diet which does not supply a healthy amount of one or more nutrients, leading to various health issues.

Marasmus

A severe form of malnutrition characterized by energy deficiency, often seen in children, leading to significant weight loss and muscle wasting.

Kwashiorkor

Severe malnutrition caused by a protein-deficient diet, causing the feet and abdomen to swell with water.

Overweight Infants

Infants who have a body mass index (BMI) higher than the typical range for their age and sex, potentially leading to health risks.