Suppose that one-year Treasury bills yield 6 percent in the United States and 4 percent in Britain. Investors will be indifferent between them if they expect the dollar to
A) depreciate against the pound by approximately 2 percent.
B) appreciate against the pound by approximately 2 percent.
C) depreciate against the pound by approximately 33 percent.
D) appreciate against the pound by approximately 33 percent.
A
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The New Deal reduced
(a) government involvement in private affairs. (b) individual liberty. (c) taxes. (d) rent-seeking.
Which is least accurate about foreign trade?
a. In the early 1900s, the most industrialized nations exported foodstuffs and raw materials to the least developed countries. b. After the Civil War, rapid improvements in communications, like the first successful transatlantic cable, lowered the price of trade. c. After the Civil War, rapid improvements in transportation, like the opening of the Suez Canal and developments of railroads, reduced the price of shipping. d. In the late 1800s and early 1900s the network of international trade assumed many of its modern characteristics.
Explain how an interest rate futures contract differs from an outright purchase of a bond.
What will be an ideal response?
Refer to the diagrams. The location of curve B depends on the:
A. level of real GDP.
B. location of curve A only.
C. interest rate only.
D. interest rate together with the location of curve A.