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If a Foreign Country's Interest Rate Is Similar to the U.S

Question 52

Multiple Choice

If a foreign country's interest rate is similar to the U.S. rate, the forward rate premium or discount will be ____, meaning that the forward rate and spot rate will provide ____ forecasts.


A) substantial; similar
B) substantial; very different
C) close to zero; similar
D) close to zero; very different

Correct Answer:

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