Assume That the U

question 35

Multiple Choice

Assume that the U.S. interest rate is 11 percent, while Australia's one-year interest rate is 12 percent. Assume interest rate parity holds. If the one-year forward rate of the Australian dollar was used to forecast the future spot rate, the forecast would reflect an expectation of:​

• A)depreciation in the Australian dollar's value over the next year.
• B)appreciation in the Australian dollar's value over the next year.
• C)no change in the Australian dollar's value over the next year.
• D)information on future interest rates is needed to answer this question.

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Definitions:

Charismatic Leadership

A leadership style characterized by an individual's ability to inspire and motivate followers through their personality and actions.

Transactional Leaders

Leaders who focus on the routine transactions between the organization and its members, emphasizing clear structures, rewards for performance, and penalties for non-performance.

Expectancy Theory

A motivational theory suggesting that an individual's motivation is influenced by their belief in the effectiveness of their efforts, the value of the rewards for success, and the likelihood that their efforts will lead to expected outcomes.

Goal Setting

The process of identifying specific, measurable, achievable, relevant, and time-bound objectives.