If in Chicago the Interest Rate Is 5 Percent a Year

question 56

Multiple Choice

If in Chicago the interest rate is 5 percent a year and in Vancouver it is 4 percent a year, ________.

• A) the quantity of Canadian dollars purchased will increase
• B) the Canadian dollar is expected to depreciate
• C) interest rate parity does not exist
• D) the U.S. dollar is expected to depreciate

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Definitions:

UCC

The Uniform Commercial Code, a comprehensive set of laws governing all commercial transactions in the United States.

Oral Contract

is an agreement between parties that is spoken and not written down, yet is legally binding, provided it can be proven to exist and meets legal requirements.

Written Memorandum

A document recording the terms of a contract or agreement, not necessarily formalized but intended as a binding outline of intent between parties.

Course of Performance

A term used in contract law referring to the conduct between parties that can help interpret the agreement's terms over time.