Use the Following to Answer Questions

question 282

Multiple Choice

Use the following to answer questions :
Scenario: Japan and the United States
Suppose that the interest rate in the United States is 4%, in Japan it is 7%, and financial assets in the two countries are equal in risk.
-(Scenario: Japan and the United States) Refer to the scenario Japan and the United States. Assuming that loans in India and the United States carry equal risk, this implies that:

• A)U.S. lenders will lend to borrowers in India.
• B)Indian lenders will lend to U.S. borrowers.
• C)the interest rate in India will increase further as compared to the U.S. interest rate.
• D)the central bank of India has adopted a more expansionary monetary policy.

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Definitions:

Joint Tenancy

A form of property co-ownership that provides each tenant with an equal share and rights in the property, with the provision of right of survivorship.

Enforceable

A quality of law or agreement that allows it to be legally imposed or acted upon, ensuring compliance.

Written

The form of expression that uses letters of the alphabet or characters to convey information or ideas on a tangible medium.

Subleased

To lease a property by a tenant to a third party, effectively transferring some of the tenant's leasing rights.