Assume $1 Is Currently Equal to £

question 34

Multiple Choice

Assume $1 is currently equal to £.7741 in the spot market. Assume the expected inflation rate in the U.S. is 2.6 percent while it is 2.3 percent in the U.K. What is the expected exchange rate one year from now if relative purchasing power parity exists?

• A) £.7764
• B) £.7878
• C) £.7839
• D) £.7718
• E) £.7791

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Definitions:

Generalized Amnesia

A loss of memory for events that occurred over a limited period of time as well as for certain events that occurred prior to that period.

Dissociative Amnesias

A condition marked by sudden, temporary inability to remember important personal information, far beyond normal forgetfulness.

Dissociative Fugues

A scarce psychological condition manifested by transient amnesia concerning one's self identity, including personal memories, character, and distinctive qualities.

Psychodynamic Theorists

Scholars and clinicians who explore the influence of unconscious mind and childhood experiences on behavior, based on the principles founded by Sigmund Freud.