The Current Indirect Rate Is 100,the Interest Rate in the Foreign

question 50

Multiple Choice

The current indirect rate is 100,the interest rate in the foreign country is 7%,the interest rate in the home country is 5%.What is the forward indirect rate if t = 3?

• A)0.94
• B)105.82
• C)110.00
• D)112.63

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Definitions:

Slope

A measure of the steepness or gradient of a line, representing the ratio of the vertical change to the horizontal change between two points on the line.

Price

The financial cost associated with acquiring a good, service, or asset.

Income

Funds obtained regularly from work performed or investments made.

Budget Line

The budget line represents the combination of goods and services that a consumer can purchase given their income and the prices of those goods and services.