If the dollar was expected to appreciate in the 60-day forward market against the Japanese yen,it would be selling at a premium.

Question

Quizplus · Accepted Answer

If the dollar is expected to appreciate in the forward market, it means that the forward rate (the rate at which the currencies will be exchanged in the future) is higher than the spot rate (the current rate at which the currencies are exchanged). This implies that investors are willing to pay a premium to secure a higher price for the dollar in the future, resulting in a dollar selling at a premium.

If the Dollar Was Expected to Appreciate in the 60-Day