Multiple Choice
If in Chicago, U.S., the interest rate is 5 percent a year and in Vancouver, Canada, it is 4 percent a year, then
A) the quantity of Canadian dollars purchased will increase.
B) the Canadian dollar is expected to depreciate.
C) interest rate parity does not exist.
D) the U.S. dollar is expected to depreciate.
Correct Answer:
Verified
Correct Answer:
Verified
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