If a Foreign Country's Interest Rate Is Similar to the U.S

question 15

True/False

If a foreign country's interest rate is similar to the U.S. rate, the forward rate premium or discount will be close to zero, meaning that the forward rate and spot rate will provide similar forecasts.

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Definitions:

Major Depressive Disorder (MDD)

A depressive disorder characterized by persistent feelings of sadness, loss of interest or ability to feel pleasure, unexplained weight loss, difficulty sleeping, fatigue, difficulty concentrating, feelings of worthlessness or guilt, suicidal thoughts, and either agitation or slowing down. The person must not be suffering from other disorders that may present as depression, such as schizoaffective disorder or a delusional disorder.

Depressive Episode

A period characterized by persistent sadness, loss of interest in activities, and other symptoms that disrupt daily functioning.

Hypomanic

A mood state characterized by persistently elevated, expansive, or irritable mood, but less severe than full-blown mania, often seen in bipolar disorder.

Mania

A bipolar mood disorder characterized by flamboyance and expansiveness. A person experiencing a manic episode may go on shopping sprees, engage in sexually promiscuous behaviour, take on numerous, unrealistic work commitments, brag, and dominate others socially. In general, the person shows intolerance when the world does not cooperate with his or her momentary needs. Extreme or prolonged cases of mania are considered bona fide psychotic states, implying that the person is experiencing a break with reality. From the Greek mainomai, “to be mad.” See also hypomania.