The Current Exchange Rate Between Canada and a Foreign Country

question 161

Multiple Choice

The current exchange rate between Canada and a foreign country is Fc600 per $1. The nominal risk-free rate in Canada is 5%, while the foreign rate is 28%. What is the only possible forward rate
That could prevail without creating any arbitrage opportunities?

• A) Fc455.00 per $1
• B) Fc558.72 per $1
• C) Fc885.12 per $1
• D) Fc731.43 per $1
• E) Fc842.85 per $1

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Definitions:

Glutamate

An excitatory neurotransmitter crucial for brain functions including learning and memory, acting as a chemical messenger in the nervous system.

Postsynaptic Membrane

Membrane on the transmitter, or input, side of a synapse.

Enriched Environment

An enriched environment refers to settings that provide increased sensory, cognitive, and physical stimulation to promote improved neurological and behavioral outcomes.

Neurons

Specialized cells transmitting nerve impulses; the basic building blocks of the nervous system.