The Pound-Dollar Forward Rate for Pounds Is $1

question 81

Multiple Choice

The pound-dollar forward rate for pounds is $1.9068, and the spot rate is $1.9059.Pounds are selling at a ________.

• A)discounted premium
• B)backward discount
• C)forward premium
• D)forward discount

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Definitions:

Interest Rate

The fee that a borrower must pay to a lender for borrowing assets, typically represented as a percentage of the principal amount.

Time-Value

The principle stating that money in hand today is more valuable than the identical amount received later, owing to its capacity to generate earnings.

GDP Growth

The increase in the market value of goods and services produced by an economy over time, indicating economic health and progress.

Future Value

is the value of an asset at a specific date in the future, calculated from its present value and accounting for factors such as interest rates and time.