If the forward exchange rate of the yen in terms of dollars is greater than the spot exchange rate,
A) Japanese interest rates must be higher than U.S. interest rates.
B) U.S. interest rates must be higher than Japanese interest rates.
C) market participants must be expecting the dollar to appreciate against the yen.
D) market participants must be expecting the dollar to depreciate against the yen.
D
You might also like to view...
If the nominal GDP is $500 billion and the money supply is $100 billion, the velocity of money is:
a. 500. b. 5.00 c. 2.50. d. 0.40.
The unit of value function of money refers to how we think about and record a transaction, whereas the means of payment function refers to how we actually pay for the items
a. True b. False
Increasing concentration always means an industry has become effectively monopolized.
Answer the following statement true (T) or false (F)
An import quota on a product protects domestic industries by:
A. reducing the foreign supply to the domestic market and, thereby, raising the domestic price. B. increasing the foreign supply to the domestic market and, thereby, lowering the domestic price. C. increasing the domestic demand for the product and, thereby, increasing its price. D. providing the incentive for domestic producers to improve the efficiency of their operation and, thereby, reduce their per-unit costs of production.