Find the Forward Rate of Foreign Currency Y If the Spot

question 40

Multiple Choice

Find the forward rate of foreign currency Y if the spot rate is $4.50,the domestic interest rate is 6 percent,the foreign interest rate is 7 percent,and the forward contract is for nine months.

• A)$4.458
• B)$5.104
• C)$4.468
• D)$4.532
• E)none of the above

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Definitions:

Expectations

Beliefs or forecasts about future events or behaviors that can influence one's psychological and behavioral responses.

Latent Learning

Learning that occurs without immediate reinforcement but is demonstrated when motivation is present.

Discrimination Learning

A process in learning theory where an organism learns to respond differently to similar stimuli based on their consequences or rewards.

Operant Learning

A method of learning that uses rewards and punishments to influence behavior, also known as operant conditioning.