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Interest Rate Parity States That There Is a Relationship Between

Question 210

Multiple Choice

Interest rate parity states that there is a relationship between _____, ______, and _____.


A) Relative inflation rates; spot exchange rates; forward exchange rates.
B) Relative inflation rates; relative interest rates; forward exchange rates.
C) Exchange rate arbitrage; interest rate arbitrage; spot exchange rates.
D) Nominal interest rates; real interest rates; risk-free rates.
E) Relative interest rates; spot exchange rates; forward exchange rates.

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