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When the Futures Price Is Equal to the Spot Rate

question 138

Multiple Choice

When the futures price is equal to the spot rate of a given currency, and the foreign country exhibits a higher interest rate than the U.S. interest rate, astute investors may attempt to simultaneously ____ the foreign currency, invest it in the foreign country, and ____ futures in the foreign currency.


Definitions:

Kagan

A reference to Jerome Kagan, a psychologist known for his work in child development, particularly his studies on temperament.

Object Of Attachment

An individual, typically a caregiver or significant other, to whom a person forms an emotional and physical bond during early development.

Process

A series of actions or steps taken in order to achieve a particular end.

Innate

describes traits, behaviors, or abilities that are present from birth and not acquired through learning or experience.

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