If There Is a One-Year Spot Rate of 8% and a Two-Year

question 23

Multiple Choice

If there is a one-year spot rate of 8% and a two-year spot rate of 7%, the forward rate from year one to two is

• A) 8.12%.
• B) 6.01%.
• C) 5.78%.
• D) 7.53%.

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Definitions:

Democratic Allies

Nations or groups that share and support democratic values and principles, often working together on international issues.

Soviet Union

A former federative socialist state in Eurasia that existed from 1922 to 1991, known officially as the Union of Soviet Socialist Republics (USSR).

Communist-Allied

Referring to entities, organizations, or countries that are aligned with or support Communist ideologies or parties.

Political Realism

A theory in international relations focusing on power, self-interest, and the pragmatic aspects of politics, often prioritizing national security and interests over ideological concerns.