Home→ Foreign Exchange Markets →The theory according to which the difference between expected appreciation and foreign interest must be equal to domestic interest rate, is called _____________?

The reasons for smaller exposure of foreign exchange than US money center are __________?
In United States, the JPMorgan Chase is considered as __________?
The inflation rate in United States is added into real rate of interest to calculate __________?
The position which came in to existence because of holding assets more than liabilities is considered as __________?
In equilibrium position, the spread between foreign and domestic rate of interest must be equal to spread of __________?
The rule which states that similar set of goods and services produced in various countries should have equal price is classified as __________?
The position which came in to existence because of holding assets less than liabilities is considered as __________?
The larger fluctuations in portfolio value of foreign exchange of financial institutions leads to __________?
The services such as commercial trade transactions and positions in financial investments provided by financial institutions are classified as __________?
The theory which considers the change in exchange rate with the fluctuations in inflation rates is classified as __________?

The theory according to which the difference between expected appreciation and foreign interest must be equal to domestic interest rate, is called _____________?

A. interest rate parity theorem
B. appreciation parity theorem
C. domestic parity theorem
D. foreign interest parity theorem

Correct Answer: interest rate parity theorem ✔

Last Updated: May 12, 2023