Interest Rate Parity

question 11

Multiple Choice

Interest rate parity

• A)eliminates exchange rate fluctuations.
• B)exists when spot rates are equal for multiple countries.
• C)exists when the spot rate is equal to the forward rate.
• D)means that the nominal risk-free rate of return must be the same across countries.
• E)eliminates covered interest arbitrage opportunities.

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Definitions:

Ecological-Systems Approach

A perspective on human development that considers all of the influences from the various contexts of development. (Later renamed bioecological theory.)

Bronfenbrenner

A psychologist known for his ecological systems theory, which considers the complex interrelations between individual development and environmental factors.

Microsystem

A part of the ecological systems theory that refers to the immediate environment in which an individual interacts, such as family, school, peers, and workplace.

Bronfenbrenner

Urie Bronfenbrenner, a developmental psychologist renowned for the Ecological Systems Theory, which explains how the inherent qualities of a child and the characteristics of the external environment interact to influence how the child grows and develops.