Suppose That the 1-Year Forward Rate of Dollar Per Peso

question 49

Multiple Choice

Suppose that the 1-year forward rate of dollar per peso is $11.25,the current spot rate $/peso is $10.00,and the expected future spot rate $/peso is $11.50.The expected premium on the peso is:

• A) -2.5%
• B) 12.5%
• C) 15%
• D) 22.75%

---

Definitions:

Sacred Narratives

Stories regarded as holy or divine within a culture, often foundational to religious beliefs and practices, explaining the origins, traditions, and values of a community.

Human Existence

The state or fact of living or existing as a human being.

Myths

Sacred narratives that explain the fundamentals of human existence- where we and everything in our world came from, why we are here, and where we are going.

Shamans

Spiritual healers and leaders within various indigenous cultures, known for their ability to mediate between the human and spiritual worlds.