If the Interest Rate on Foreign Deposits Increases,holding Everything Else

question 31

Multiple Choice

If the interest rate on foreign deposits increases,holding everything else constant,

• A) the expected return on these deposits must also increase.
• B) the expected return on domestic deposits must decrease.
• C) the expected return on domestic deposits must increase.
• D) both A and B of the above.
• E) both A and C of the above.

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Definitions:

Santa María

The largest of the three ships used by Christopher Columbus on his first voyage across the Atlantic Ocean in 1492.

Monte

A term that can refer to a mountain or a heap of something, but contextually might need specification.

Church

Christian house of worship.

Eadwine Psalter

A highly decorated 12th-century manuscript Psalter, named after Eadwine, a monk who may have been responsible for its production, notable for its artistic and liturgical importance.