Based on Interest Rate Parity, the Larger the Degree by Which

question 36

Multiple Choice

Based on interest rate parity, the larger the degree by which the foreign interest rate exceeds the UK interest rate, the:

• A) larger will be the forward discount of the foreign currency.
• B) larger will be the forward premium of the foreign currency.
• C) smaller will be the forward premium of the foreign currency.
• D) smaller will be the forward discount of the foreign currency.

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Definitions:

B.F. Skinner

A renowned psychologist who was a leading proponent of behaviorism, emphasizing the importance of reinforcement in shaping behavior.

Living Organism

A living organism is an individual entity that exhibits the characteristics of life, such as growth, reproduction, responsiveness to stimuli, and metabolism, encompassing entities from single-celled bacteria to complex multicellular humans.

Reinforcer

In psychology, a stimulus that increases the likelihood of a particular behavior being repeated.

Reinforcer

An element or event that increases the likelihood of a behavior being repeated.