Let R_US Be the Annual Risk Free Rate in the United

question 48

Multiple Choice

Let R_US be the annual risk free rate in the United States,R_UK be the risk free rate in the United Kingdom,F be the futures price of $/BP for a 1-year contract,and E the spot exchange rate of $/BP.Which one of the following is true?

• A)if RUS > RUK, then E > F
• B)if RUS < RUK, then E < F
• C)if RUS > RUK, then E < F
• D)if RUS < RUK, then F = E
• E)There is no consistent relationship that can be predicted.

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Definitions:

Emotion

A conscious evaluative reaction that is clearly linked to some event.

Motivating Force

An internal or external stimulus that influences the direction, intensity, and persistence of behavior.

Freudian Psychoanalysts

Practitioners of a school of thought in psychology founded by Sigmund Freud, focusing on unconscious motivations and early childhood experiences.

Inner States

Refers to an individual’s internal conditions, encompassing emotions, thoughts, and feelings.