If a Foreign Country's Interest Rate Is Similar to the U.S

question 91

Multiple Choice

If a foreign country's interest rate is similar to the U.S. rate, the forward rate premium or discount will be ____, meaning that the forward rate and spot rate will provide ____ forecasts.

• A) substantial; similar
• B) substantial; very different
• C) close to zero; similar
• D) close to zero; very different

---

Definitions:

Pay Increase

An adjustment to an employee's base salary, usually upward, to reflect changes in market conditions, performance or inflation.

Classical Management Strategy

A theory of management that focuses on organizational efficiency and effectiveness through strict planning, organizing, leading, and controlling.

Economic Theory

A broad concept that encompasses various theories and principles aimed at understanding how economies function, the factors that drive economic growth, and the distribution of resources.

Management Strategy

An overarching plan or set of goals designed to achieve competitive advantage and meet organizational objectives.