The Variable F_1,1 as Used in the Expectations Theory Is

question 67

Multiple Choice

The variable f_1,1 as used in the expectations theory is interpreted as the forward rate for one year:

• A) based on the prior one-year rate.
• B) at 1 percent.
• C) based on a 1 percent increase from the current rate.
• D) commencing in one year.
• E) based on a 1 percent probability of occurrence.

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