As of Today, the Spot Exchange Rate Is €1

question 39

Multiple Choice

As of today, the spot exchange rate is €1.00 = $1.50 and the rates of inflation expected to prevail for the next year in the U.S. is 2% and 3% in the euro zone. What is the one-year forward rate that should prevail?

• A)€1.00 = $1.5147
• B)€1.00 = $1.4854
• C)€1.00 = $0.6602
• D)$1.00 = €0.6602

---

Definitions:

Double-Barreled

Questions or statements that attempt to address more than one issue at a time, often leading to confusion or inaccurate responses.

Negatively Worded

relates to items or questions in surveys or assessments that are phrased in a manner where agreement indicates a lack or decline of the trait or behavior of interest.

Simplistic

An overly simple view or explanation of something that does not account for all the complexities involved.

Social Desirability

The tendency of respondents to answer questions in a manner that will be viewed favorably by others.