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NEW QUESTION: 1
Barton Wilson, a junior analyst, is a new hire at a money center bank. He has been assigned to help Juanita Chevas, CFA, in the currency trading department. Together, Wilson and Chevas are working on the development of new trading software designed to detect profitable opportunities in the foreign exchange market. Obviously, they are interested in risk-free arbitrage opportunities. However, they have also been instructed to investigate the possibility of longer-term currency exposures that are not necessarily risk-free. To test the logic of their new software, Wilson gathers the following market data:
* Spot JPY/USD exchange rate = 120.
* Spot EUR/USD exchange rate = 0.7224.
* U.S. risk-free interest rate = 7%.
* Eurozone risk-free rate = 9.08%.
* Japanese risk-free rate = 3.88%.
* Yield curves in all three currencies are flat.
In addition to in-house currency transactions, the new software program is also intended to provide insight into currency exposure and hedging needs for the bank's major customers. These customers typically include large multinational firms. Essentially, the bank wants to provide consulting services to its clients concerning which currency exposures offer the greatest possibility of appreciation. In this process, the bank will rely on deviations from international parity conditions as an indicator of long-term currency movements.
Wilson obtains the following data from the econometrics department:
* JPY/USD spot rate one year ago =116.
* EUR/USD spot rate one year ago = 0.7200.
* Anticipated and historical U.S. annual inflation = 3%.
* Anticipated and historical Japanese annual inflation = 0%.
* Anticipated and historical Eurozone annual inflation = 5%.
One of the bank's major customers has significant portions of its business in Japan, and the Eurozone and has long exposure to both currencies. The customer has traditionally hedged all currency risk. However, the customer's new risk manager has decided to leave some currency exposure unhedged in an attempt to profit from long-term currency exposure.
An unexpected decline in the growth rate of the USD money supply would most likely cause:
A. the real USD interest rate to increase and the value of the USD to appreciate.
B. the real USD interest rate to decrease and the value of the USD to appreciate.
C. the real USD interest rate to increase and the value of the USD to depreciate.
Answer: A
Explanation:
Explanation/Reference:
Explanation:
If there were an unexpected decline in the growth rate of the money supply, real interest rates would rise, causing an appreciation of the dollar. (Study Session 4, LOS 19.c)
NEW QUESTION: 2
Refer to the exhibit.
Which python data structure does my_json contain?
A. Dict
B. List
C. Json
D. Map
Answer: A
NEW QUESTION: 3
You have a computer that runs Windows 7.
The computer has two drives named C and D.
Windows Backup is scheduled to run every day. The scheduled backup backs up a system image, all user, files, and drive D.
Drive D fails.
You replace the drive with a new drive.
You need to recover the data on drive D by using the minimum amount of administrative effort. The solution must minimize downtime.
What should you do?
A. From Backup and Restore, click Restore all users files.
B. From the properties of drive D, restore all previous versions.
C. Open System Restore and apply the latest restore point.
D. Start the computer from a system repair disc and restore a system image.
Answer: A
Explanation:
Explanation/Reference:
10293 40234
NEW QUESTION: 4
HOTSPOT
You are developing a web application.
You need to create the following graphic by using Cascading Style Sheets (CSS):
Use the drop-down menus to select the answer choice that completes each statement. Each correct selection is worth one point.
Hot Area:
Answer:
Explanation:
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