Let If Be the Interest Rate Being Paid on a Foreign

question 45

Multiple Choice

Let if be the interest rate being paid on a foreign bond, and let i be the interest rate being paid for a domestic bond; let P be the price of the domestic bond and let Pf be the price of the foreign bond. If exchanges rates are fixed and the bonds are equal in terms of risk:

• A) if = i.
• B) P = Pf times units of domestic currency/unit of foreign currency.
• C) the expected return from the foreign bond = the expected return from the domestic bond.
• D) all of the answers given are correct.

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A psychoanalytic process in which the patient speaks freely to reveal the unconscious thoughts and feelings that might be causing psychological distress.

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