The US Interest Rate Minus the Foreign Interest Rate Is Called

question 342

Multiple Choice

The U.S. interest rate minus the foreign interest rate is called the

• A) foreign interest rate differential.
• B) U.S. bond rate differential.
• C) U.S. interest rate differential.
• D) U.S. stock yield differential.

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Definitions:

Forward Contract

A non-standardized contract between two parties to buy or sell an asset at a specified future time at a price agreed upon today, often used for hedging risks.

Canadian Dollars

The currency of Canada, represented as CAD or $.

Gross Recording

An accounting practice where transactions are recorded in full without deducting any related expenses or costs.

Spot Rates

The current market price at which a particular asset can be bought or sold for immediate delivery.