The Current Indirect Rate Is 0

question 34

Multiple Choice

The current indirect rate is 0.8500,the interest rate in the foreign country is 3%,and the interest rate in the home country is 4%.What is the forward indirect rate if t = 1?

• A)0.8418
• B)0.8429
• C)0.8441
• D)0.8496

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Definitions:

Trade

The practice, in a market economy, in which individuals provide goods and services to others and receive goods and services in return.

Specialize

Specialize refers to the process of focusing efforts and resources on a narrow area of expertise or production to gain efficiency, higher quality, or other advantages.

Comparative Advantage

An economic principle that states a country or individual can produce goods at a lower opportunity cost than others, leading to more efficient global trade outcomes.

France

A country in Western Europe known for its rich history, culture, and significant contributions to art, science, and politics.