$$\begin{array} { | l | l | }
\hline \text { Investor } & \begin{array} { l }
\text { Expected future value of a } \
\text { dollar (francs per doll ar) }
\end{array} \
\hline \text { Investor A } & 120 \
\hline \text { Investor B } & 100 \
\hline \text { Investor C } & 85 \
\hline
\end{array}$$
-Using the table above, if the current market value of the dollar is 110 francs,
A) investor C expects dollar depreciation, but A and B expect appreciation.
B) all three investors expect the dollar to appreciate.
C) investor A expects dollar appreciation, but B and C expect depreciation.
D) all three investors expect the dollar to depreciate.

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 110 francs,
A) investor C expects dollar depreciation, but A and B expect appreciation.
B) all three investors expect the dollar to appreciate.
C) investor A expects dollar appreciation, but B and C expect depreciation.
D) all three investors expect the dollar to depreciate.

Quizplus · Accepted Answer

Investor A expects the dollar to appreciate because they expect the future value to be 120 francs per dollar, which is higher than the current 110 francs. Investors B and C expect depreciation because their expected future values (100 and 85 francs per dollar, respectively) are lower than the current market value.

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