The Variable ƒ_1,1 as Used in the Expectations Theory Is

question 29

Multiple Choice

The variable ƒ_1,1 as used in the expectations theory is interpreted as the forward rate for one year:

• A)based on the prior one-year rate.
• B)at 1%.
• C)based on a 1% increase from the current rate.
• D)commencing in one year.
• E)based on a 1% probability of occurrence.

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