If the Difference Between Forward and Spot Exchange Rates Is

question 36

Multiple Choice

If the difference between forward and spot exchange rates is positive, interest rate parity would predict that:

• A)The difference in interest rates between countries will be negative
• B)The difference in interest rates between countries will be positive
• C)There will be no difference in interest rates between countries
• D)The difference will be quickly eliminated

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Definitions:

Johnson Administration

The executive period of Lyndon B. Johnson, the 36th president of the United States, from 1963 to 1969, known for his Great Society programs.

Foreign Affairs

A field of policy concerned with relationships between countries, including diplomacy, international trade agreements, and global conflict resolution.

Reelection

The act of being elected again to the same position or office.