The Condition Stating That the Interest Rate Differential Between Two

question 85

Multiple Choice

The condition stating that the interest rate differential between two countries is equal to the percentage difference between the forward exchange rate and the spot exchange rate is called:

• A) the unbiased forward rates condition.
• B) uncovered interest rate parity.
• C) the international Fisher effect.
• D) purchasing power parity.
• E) interest rate parity.

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