Assuming That Current Currencies Are Currently in Equilibrium and the Exchange

question 59

Multiple Choice

Assuming that current currencies are currently in equilibrium and the exchange rate for the Brazilian Real is R/$ = 1.753 and that the U.S.expects inflation over the next year to be 4% While in Brazil there is an expectation of 7.3%; what must the exchange rate be in one year? (R/$)

• A) 1.634
• B) 1.881
• C) 1.809
• D) 1.823

---

Definitions:

Optimal Level

The most favorable or advantageous degree of intensity or concentration for a specific function or activity.

Transference

A phenomenon in psychoanalysis where patients project feelings, attitudes, or desires onto their therapist, confusing the therapist with figures from their past.

Monoamine Oxidase

An enzyme responsible for breaking down neurotransmitters such as dopamine, norepinephrine, and serotonin in the brain.

Tricyclics

Tricyclics are a class of antidepressant drugs used primarily to treat major depressive disorder by affecting neurotransmitter levels in the brain.