Which one of the following formulas correctly defines the relationship to which it is associated?
A) Interest rate parity: (F1) /(S0) = (1 + RFC) (1 + RCDN)
B) Relative PPP: E(St) = [S0][1 + (hCDN - hFC) ]t
C) International Fisher effect: RCDN - hCDN = hFC - RFC
D) Uncovered interest rate parity: E(St) = [S0][1 + (RFC - RCDN) ]t
E) Unbiased forward rate: F3 = (S0)
Correct Answer:
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