If the interest rate on a U.S. one-year bond is 2%, the interest rate on a Brazilian one-year bond is 8%, and the currency premium on reals (Brazilian currency) is 3%,
what is the expected rate of appreciation of the U.S. dollar according to interest-rate parity?
A) -3%
B) 3%
C) 5%
D) 6%
B
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If the interest rate on euro-denominated assets is 13 percent and it is 15 percent on peso-denominated assets, and if the euro is expected to appreciate at a 4 percent rate,
for Manuel the Mexican the expected rate of return on euro-denominated assets is A) 11 percent. B) 13 percent. C) 17 percent. D) 19 percent.
Tucker Corporation sells its product for $5.00. Tucker's industrial engineers have informed management that hiring one additional worker will increase output by five units per hour. Tucker should hire the additional worker only if the wage rate is:
A. $5.00 or less per hour. B. $1.00 or more per hour. C. $25.00 or less per hour. D. more than $25.00 per hour.
Which industry was first covered by a free trade agreement between Canada and the United States?
What will be an ideal response?
Which of the following is not included in M1?
A. Savings account balances at a federal savings bank. B. Credit union share drafts. C. Transactions account balances at mutual savings banks. D. Currency in circulation outside of commercial banks.