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    International Financial Management Study Set 6
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    Exam 6: International Parity Relationships and Forecasting Foreign Exchange Rates
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    When Interest Rate Parity (IRP) Does Not Hold
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When Interest Rate Parity (IRP) Does Not Hold

Question 73

Question 73

Multiple Choice

When Interest Rate Parity (IRP) does not hold


A) there is usually a high degree of inflation in at least one country.
B) the financial markets are in equilibrium.
C) there are opportunities for covered interest arbitrage.
D) both b and c

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