Which of the Following Is an Example of Interest Rate

question 36

Multiple Choice

Which of the following is an example of interest rate parity?

• A)The Japanese yen trades at the same exchange rate as the Swiss franc.
• B)US dollar rates on one-year US Treasury securities equal one-year Japanese government bond rates.
• C)US dollar rates on one-year US Treasury securities equal one-year Japanese government bond rates, restated in dollars.
• D)British pound two-year forward rates equal two-year Swiss franc forward rates.

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Definitions:

Accounts Receivable

Money owed to a business by its customers for goods or services that have been delivered but not yet paid for.

Temporal Method

A technique used in foreign currency translation that uses exchange rates based on the timing of the original transaction.

Remeasuring

The process of adjusting financial statements to reflect fair values or changes in exchange rates, often used in foreign currency translation and in fair value accounting.

Financial Statements

Reports that provide an overview of a company's financial condition, including the balance sheet, income statement, and cash flow statement.