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Mathematically, Interest Rate Parity Between the Currencies of Two Countries I(1+iB)=(1 S)(1iA)F\mathrm{I}(1+\mathrm{i} \mathrm{B})=\left(\frac{1}{\mathrm{~S}}\right)(1-\mathrm{i} \mathrm{A}) \mathrm{F}

Question 48

Multiple Choice

Mathematically, interest rate parity between the currencies of two countries, A and B, can be expressed as ________.


A)
I(1+iB) =(1 S) (1iA) F\mathrm{I}(1+\mathrm{i} \mathrm{B}) =\left(\frac{1}{\mathrm{~S}}\right) (1-\mathrm{i} \mathrm{A}) \mathrm{F}

B)
I(1iA) =(1 F) (1+iB) S\mathrm{I}(1-\mathrm{i} \mathrm{A}) =\left(\frac{1}{\mathrm{~F}}\right) (1+\mathrm{i} \mathrm{B}) \mathrm{S}

C)
I(1iA) =(1 S) (1iB) F\mathrm{I}(1-\mathrm{i} \mathrm{A}) =\left(\frac{1}{\mathrm{~S}}\right) (1-\mathrm{i} \mathrm{B}) \mathrm{F}

D)
I(1+iA) =(1 S) (1+iB) F\mathrm{I}\left(1+\mathrm{i}_{\mathrm{A}}\right) =\left(\frac{1}{\mathrm{~S}}\right) \left(1+\mathrm{i}_{\mathrm{B}}\right) \mathrm{F}

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