Which of the Following Statements Is True

question 61

Multiple Choice

Which of the following statements is true?

• A)Interest rate parity indicates that the forward premium or discount should be greater than the differences in the national interest rates for securities of the same maturity.
• B)Purchasing-power parity indicates that, in the long run, exchange rates adjust to reflect international differences in inflation so that the purchasing-power of each currency tends to remain the same.
• C)The International Fisher Effect indicates that the nominal interest rate should be the same all over the world at all times if the market is efficient.
• D)Both B and C)

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Definitions:

African Methodist Episcopal Church

A historic black church established in the United States, part of the larger Methodist Episcopal tradition.

Segregated Seating Policy

A discriminatory practice of separating people in public places based on race, often found in theaters, transportation, and schools, mainly prior to the civil rights movements.

Urbanized Group

A population living in areas characterized by high human settlement density and infrastructure of built environment.

Skilled Trades

Occupations that require specific training, often involving manual work, such as carpentry, plumbing, and electrical work.