Which of the Following Appears to Be a Safe Assumption

question 36

Multiple Choice

Which of the following appears to be a safe assumption when there is no difference between the forward and spot exchange rates between two currencies?

• A) The countries have equal nominal interest rates.
• B) The spot rate is expected to change.
• C) Expected inflation is less than the nominal rate.
• D) Both currencies are selling at a premium relative to the other.

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Definitions:

Pure Comparative Negligence

A defense accepted in some states whereby the defendant is not liable for the percentage of harm that he or she can prove can be attributed to the plaintiff’s own negligence.

25%

A quarter of something, often referred to in contexts of percentages, rates, or divisions.

Implied Assumption

An unstated understanding or expectation within an agreement or contract, often derived from the actions of the parties or the context of the agreement.

Expressly Agrees

A term indicating that a party has explicitly consented to an agreement or condition, leaving no doubt about their intention.