What Would You Expect to Occur If the Rate of Expected

question 46

Multiple Choice

What would you expect to occur if the rate of expected inflation in Canada is considerably lower than expected inflation in Germany?

• A)The expected spot rate of DM/$will increase.
• B)The current spot rate of DM/$will increase.
• C)The Dollar should appreciate against the DM.
• D)The Dollar should depreciate against the DM.

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