If an Investor Can Obtain More of a Foreign Currency

question 35

True/False

If an investor can obtain more of a foreign currency for a dollar in the forward market than in the spot market, then the forward currency is said to be selling at a discount to the spot rate.

---

Definitions:

Free-Rider Problem

A situation in which individuals benefit from resources or services without paying for them, which can lead to under-provision or depletion of those resources.

Selective Incentives

Benefits or rewards provided by groups to entice members to join and remain active within the organization, often used within the context of political or social groups.

American Association of Retired People

A large, United States-based non-profit organization focused on issues affecting those over the age of fifty, including health care, employment security, and retirement planning.

Super PACs

Unrestricted in the amount of money they can collect from corporations, unions, and individuals, these independent political committees are, however, forbidden from directly coordinating activities with political parties or candidates.