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As of Today, the Spot Exchange Rate Is €1

question 90

Multiple Choice

As of today, the spot exchange rate is €1.00 = $1.60 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?

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Definitions:

Metric System

A decimal system of weights and measures based on the meter, liter, and gram as units of length, capacity, and weight or mass, respectively.

Drug

A substance used in the diagnosis, treatment, or prevention of diseases, capable of affecting physical or mental functions.

Space

A continuous area or expanse that is free, available, or unoccupied; also the physical universe beyond the earth's atmosphere.

Occupies

To reside in or take up space within a particular place or structure.

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