Exhibit 11.1 Assume the Following

question 194

Multiple Choice

Exhibit 11.1 Assume the following:
(1) the interest rate on 6-month treasury bills is 8 percent per annum in the United Kingdom and 4 percent per annum in the United States;
(2) today's spot price of the pound is $1.50 while the 6-month forward price of the pound is $1.485.
-Refer to Exhibit 11.1.If the price of the 6-month forward pound were to ____,U.S.investors would no longer earn an extra return by shifting funds to the United Kingdom.

• A) Rise to $1.52
• B) Rise to $1.53
• C) Fall to $1.48
• D) Fall to $1.47

---

Definitions:

Congress

A formal meeting or assembly of representatives for discussion and legislation, or the national legislative body of a country, especially in the United States.

Conflagration

A large and destructive fire that causes significant damage and loss.

Evaluation

The systematic assessment of the value, effectiveness, or impact of a program, policy, or intervention, often based on predefined criteria.

Service Objective

A specific, targeted outcome or goal that a service aims to achieve, guiding the direction and strategies of the service provision.