When the Interest Parity Condition Holds, We Know That the Domestic

Multiple Choice

When the interest parity condition holds, we know that the domestic interest rate must be equal to:

A) the expected rate of appreciation of the domestic currency.
B) the foreign interest rate minus the expected rate of appreciation of the domestic currency.
C) the foreign interest rate plus the expected rate of appreciation of the domestic currency.
D) the expected rate of depreciation of the domestic currency.
E) the foreign interest rate.