The Forward Rate Market Is Dependent Upon

question 69

Multiple Choice

The forward rate market is dependent upon:

• A) current forward rates exceeding current spot rates.
• B) current spot rates exceeding current forward rates over time.
• C) current spot rates equaling current forward rates, on average, over time.
• D) forward rates equaling the actual future spot rates on average over time.
• E) current spot rates equaling the actual future spot rates on average over time.

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Definitions:

Absolute Advantage

The ability of an individual, company, or country to produce a good or service at a lower cost per unit than others.

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost than another entity, leading to more efficient trade.

Radios

Devices used for the wireless transmission and reception of sound through electromagnetic waves.

Televisions

Electronic devices designed for the reception and display of audiovisual content through terrestrial, satellite, cable, or internet sources.