Use the Following Table to Answer the Next Two Questions

question 170

Multiple Choice

Use the following table to answer the next two questions
European Expected value of the dollar in 3 months
Investor (dollars per euro)
Investor #1 $1.30
Investor #2 $1.20
Investor #3 $1.15
-If the current exchange value of the dollar is $1.25 per euro

• A) European Investor #1 expects a dollar depreciation against the euro,but European Investors #2 and #3 expect a dollar appreciation
• B) European Investor #1 expects a dollar appreciation against the euro,but European #2 and #3 expect a dollar depreciation
• C) all three European investors expect that the dollar will depreciate against the euro
• D) all three European investors expect that the dollar will appreciate against the euro

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Definitions:

Crowns of France

Symbols of monarchy and authority in France, historically associated with the French kings.

Spain

A country located on the Iberian Peninsula in Europe, known for its rich history including Roman and Islamic dominations, and the later establishment of a global empire in the Americas.

Château at Versailles

A grand royal palace located in Versailles, France, built by King Louis XIV, and known for its opulent architecture, historic significance, and as a symbol of the absolute monarchy of the Ancien Régime.

Louis XIV

Known as the "Sun King," he was King of France from 1643 to 1715 and is noted for his centralized administration and lavish court at Versailles.