If the Future Rate Equals the Spot Rate, Then in Equilibrium

question 42

Multiple Choice

If the future rate equals the spot rate, then in equilibrium:

• A) the exchange rate must depreciate.
• B) interest rates should be different.
• C) the exchange rate will appreciate.
• D) None of these will occur.

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Definitions:

Southern Rebellion

Commonly referred to the American Civil War's Confederate states' secession and military defiance against the Union, representing a major internal conflict based on states' rights and the issue of slavery.

Naval Blockade

A naval blockade is the deployment of naval vessels to prevent ships from entering or leaving ports belonging to or occupied by the enemy, used as a form of economic warfare.

Civil War

The Civil War was a conflict fought in the United States from 1861 to 1865, primarily over issues of slavery and states' rights, resulting in the preservation of the Union and the abolition of slavery.

Freedom and Liberty

Concepts centered on the right and ability of people to act and express themselves without undue restraint or coercion.