Identify One of the Major Reasons Behind the Decline in the Dollar-Yen

question 90

Multiple Choice

Identify one of the major reasons behind the decline in the dollar-yen carry trade during 2008-09.

• A)Increase in risk appetite making the carry trade less attractive
• B)Increase in the value of Japanese yen against the U.S.dollar
• C)Increase in interest rate differentials as Japanese rates came down
• D)Decrease in interest rate differentials as the U.S.rates went up

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Definitions:

Phenyl-Ethylamine

A natural monoamine alkaloid often associated with mood elevation and love due to its presence in chocolate.

Dimethylcyclopentane

A chemical compound consisting of a cyclopentane ring with two methyl groups attached to it.

Ethanol

A volatile, flammable, colorless liquid alcohol widely used as a solvent and a beverage intoxicating agent.

Mechanism

A process or series of steps that bring about a particular result, often described in the context of chemical reactions.