$$\begin{array} { | l | l | }
\hline \text { Investor } & \begin{array} { l }
\text { Expected future value of a } \
\text { dollar (francs per doll ar) }
\end{array} \
\hline \text { Investor A } & 120 \
\hline \text { Investor B } & 100 \
\hline \text { Investor C } & 85 \
\hline
\end{array}$$
-Using the table above, if the current market value of the dollar is 125 francs,
A) all three investors hold francs.
B) investor A holds dollars, but B and C hold francs.
C) investor A holds francs, but B and C hold dollars.
D) all three investors hold dollars.

Question

$$\begin{array} { | l | l | } 
\hline \text { Investor } & \begin{array} { l } 
\text { Expected future value of a } \
\text { dollar (francs per doll ar) }
\end{array} \
\hline \text { Investor A } & 120 \
\hline \text { Investor B } & 100 \
\hline \text { Investor C } & 85 \
\hline
\end{array}$$
-Using the table above, if the current market value of the dollar is 125 francs,
A) all three investors hold francs.
B) investor A holds dollars, but B and C hold francs.
C) investor A holds francs, but B and C hold dollars.
D) all three investors hold dollars.

Quizplus · Accepted Answer

Investor A expects the franc to appreciate against the dollar, so he holds francs. Investors B and C expect the franc to depreciate against the dollar, so they hold dollars.

-Using the Table Above, If the Current Market Value of