The Real Exchange Rate Is

question 28

Multiple Choice

The real exchange rate is

• A)the price of one currency in terms of another.
• B)the price of domestic goods relative to foreign goods.
• C)the quantity of gold that can be purchased by one unit of currency.
• D)the difference in interest rates between two countries.

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Definitions:

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturity date, factoring in its current price, interest payments, and face value.

Par Value

The face value of a bond or stock as stated by the issuing company, which may differ from its market value.

Coupon Rate

The yearly percentage of the bond's face value that is paid out as interest by a bond.

Current Yield

The annual income (interest or dividends) divided by the current price of the security.