Multiple Choice
The Canadian interest rate is 4 percent and the U.S.interest rate is 6 percent.If the interest parity condition holds,we expect
A) the Canadian dollar to appreciate by 2 percent.
B) the Canadian dollar to depreciate by 6 percent.
C) the U.S.dollar to depreciate 2 percent.
D) the U.S.dollar to appreciate by 2 percent.
Correct Answer:
Verified
Correct Answer:
Verified
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