Nominal Interest Rates in India Are 7%, While Nominal Interest

question 32

Multiple Choice

Nominal interest rates in India are 7%, while nominal interest rates in the UK are 5%. The spot rate for the Indian rupee (INR) is £0.120. According to the international Fisher effect (IFE) , the rupee should adjust to a new level (to the nearest £0.001) of:

• A) £0.015.
• B) £0.118.
• C) £0.119.
• D) £0.121.

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Definitions:

Conceptual Skills

The ability to understand complex ideas and apply strategic thinking for problem-solving and planning.

Decisional Roles

Roles associated with making choices and decisions that affect the direction and operation of an organization.

Henry Mintzberg

A distinguished expert in management theory, recognized for his contributions to organizational frameworks, strategic planning, and the efficacy of management.

Arranging Coordinated Activities

Organizing and managing different tasks or actions to work together efficiently towards a common goal.