Small Corporation Would Like to Forecast the Value of the Cyprus

question 78

Multiple Choice

Small Corporation would like to forecast the value of the Cyprus pound (CYP) five years from now using forward rates. Unfortunately, Small is unable to obtain quotes for five-year forward contracts. However, Small observes that the five-year interest rate in the U.S. is 11%, while the Cyprus five-year interest rate is 15%. Based on this information, the Cyprus pound should ____ by ____% over the next five years.

• A) appreciate; 16.22
• B) depreciate; 16.22
• C) appreciate; 6.66
• D) depreciate; 6.66
• E) none of the above

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Definitions:

Calloc()

A function in C programming language used to dynamically allocate memory for an array of objects, initializing them to zero.

Numeric Memory

A term not typically used in standard computing language; possibly refers to memory areas designated for numerical data. NO.

Dynamic Memory Allocation

The process of allocating memory at runtime using various methods in programming languages like C and C++ (malloc, free, new, delete), allowing flexible sizes for data structures.