If the International Fisher Effect Holds,what Will Be the Effect

question 20

Multiple Choice

If the international Fisher effect holds,what will be the effect of an increase of a country's nominal interest rates on the country's currency?

• A) The currency will appreciate.
• B) The currency will depreciate.
• C) There will be no significant change in the currency's value.
• D) The currency will sell at a forward premium.

---

Definitions:

Public Assistance Income

Financial support provided by government agencies to individuals and families who have low income or no income, to help them meet their basic needs.

Cooling-Off Rule

A Federal Trade Commission rule under which sales of consumer goods or services over $25 made away from the seller’s regular place of business may be canceled within three business days after the sale occurs.

Entered Completely

A term that implies that data or information has been fully inputted into a system or document without omissions.

Risk-Adaptability Analysis

An assessment method used to evaluate the flexibility and responsiveness of a system, organization, or project to potential risks.