Which of the Following Caused a Decline in the Dollar-Yen

question 23

Multiple Choice

Which of the following caused a decline in the dollar-yen carry trade during 2008-09?

• A) Increase in risk appetite making the carry trade less attractive
• B) Decrease in interest rate differentials as the U.S. rates came down
• C) Increase in interest rate differentials as Japanese interest rates came down
• D) Decrease in interest rate differentials as the U.S. interest rates went up
• E) Decrease in interest rate differentials as the Japanese rates went up

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Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities; also known as shareholders' equity.

Retained Earnings Statement

A financial report detailing the modifications in accumulated profits over a certain timeframe.

Prior Period Adjustments

Corrections of errors in financial statements of prior periods or adjustments for omitted transactions.

Preferred Stock

A class of ownership in a corporation with a higher claim on assets and earnings than common stock, often with fixed dividends.