What does it mean for the 90-day forward exchange rate to be an unbiased predictor of the future spot exchange rate?
What will be an ideal response?
If the forward exchange rate for 90 days is an unbiased predictor of the future spot rate, the forward rate is equal to the expected future spot rate. While there will be forecast errors that may be large, there will not be systematic errors on one side or the other. Therefore, the expected forward market return is zero.
You might also like to view...
Flexible resources are acquired from those outside the organization and do not require a long-term commitment
Indicate whether the statement is true or false
Essentially, the entire statement of financial position is inverted compared to what is commonly seen in the United States
a. True b. False Indicate whether the statement is true or false
Which of the following statements best describes the modern view of marketing?
A. Marketing should take over production, accounting, and financial services within a firm. B. The job of marketing is to get rid of whatever the company is producing. C. Production, not marketing, should determine what goods and services are to be developed. D. Marketing is concerned with generating a single exchange between a firm and a customer. E. Marketing begins with anticipating potential customer needs.
A system in which a shareholder can accumulate all of his or her votes and vote them all for one candidate or split them among several candidates is known as ________
A) trust voting B) noncumulative voting C) cumulative voting D) supramajority voting