Expected Interest-Rate Parity Predicts That

question 63

Multiple Choice

Expected interest-rate parity predicts that:

• A)countries with relatively higher inflation can expect a depreciation in the value of their currency
• B)countries with relatively lower inflation can expect a depreciation in the value of their currency
• C)countries with relatively higher interest rates can expect an appreciation in the value of their currency
• D)countries with relatively higher interest rates can expect a depreciation in the value of their currency
• E)countries with relatively higher inflation can expect an appreciation in the value of their currency.

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