Assume the Spot Rate on the Japanese Yen Is ¥110

question 16

Multiple Choice

Assume the spot rate on the Japanese yen is ¥110.05 while it is C$1.1379 on the Canadian dollar. The respective three-month forward rates are ¥111.75 and C$1.1339. The value of the U.S. dollar will ________ with respect to the yen and will ________ with respect to the Canadian dollar.

• A) appreciate; appreciate
• B) appreciate; depreciate
• C) depreciate; appreciate
• D) depreciate; depreciate
• E) depreciate; remain constant

---

Definitions:

Occupation

A job or profession practiced by an individual, often requiring specific skills or training.

Bureau of Labor Statistics

A U.S. government agency responsible for collecting, processing, and disseminating essential statistical data related to labor market activity, working conditions, price changes, and productivity.

Price Increase

The rise in the cost of goods or services in the market.

Labor Needed

The quantity and type of workforce required to produce a certain level of output or to perform specific tasks.