Assume the Exchange Rate Is GBP 1

question 23

Multiple Choice

Assume the exchange rate is GBP 1.35/USD, the US risk-free rate is 3.0 percent, and the UK risk-free rate is 3.0 percent. What is the implied one-year forward rate?

• A) GBP 1.40/USD
• B) GBP 1.35/USD
• C) GBP 1.30/USD
• D) GBP 1.25/USD
• E) GBP 1.20/USD

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Definitions:

Bone and Cartilage

Connective tissues in the body, where bone is hard and dense, providing structure and support, while cartilage is more flexible and cushions joints.

Lacunae

Small cavities in bone or cartilage tissue housing cells like osteocytes or chondrocytes.

Simple Squamous Epithelium

A single layer of flat cells lining surfaces where diffusion or filtration occurs, such as the alveoli in the lungs.

Alveoli

Tiny air sacs within the lungs where the exchange of oxygen and carbon dioxide between the air in the lungs and the blood in the capillaries takes place.