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  3. Study Set
    International Financial Management Study Set 1
  4. Exam
    Exam 20: Short-Term Financing
  5. Question
    If Interest Rate Parity Exists, and the Forward Rate Is
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If Interest Rate Parity Exists, and the Forward Rate Is

Question 1

Question 1

Multiple Choice

If interest rate parity exists, and the forward rate is an accurate estimator of the future spot rate, the foreign financing rate will be ____ the home financing rate.


A) lower than
B) greater than
C) similar to
D) none of the above

Correct Answer:

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