Use the Following Table to Answer the Next Two Questions

question 130

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 has less incentive to invest in the United States,and thus demands fewer dollars
• B) European Investor #2 has less incentive to invest in the United States,and thus demands fewer dollars
• C) European Investor #3 has less incentive to invest in the United States,and thus demands fewer dollars
• D) all three European investors have less incentive to invest in the United States,and thus demands fewer dollars

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Definitions:

EEG

Electroencephalogram, a test that measures electrical activity in the brain and is used to diagnose neurological conditions.

Polygraph

A lie detector test that measures and records several physiological indicators such as blood pressure, pulse, respiration, and skin conductivity while the subject is asked and answers a series of questions.

fMRI

Functional Magnetic Resonance Imaging, a non-invasive neuroimaging technique that measures brain activity by detecting changes associated with blood flow.

PET Scan

A diagnostic imaging test using a radioactive substance to visualize and measure metabolic processes in the body.