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The primary indicator of the Fed’s stance on monetary policy is

Assume that Kramer Co. will receive SF800,000 in 90 days. Today’s spot rate of the Swiss franc is $.62, and the 90-day forward rate is $.645. Kramer has developed the following probability distribution for the spot rate in 90 days:  Possible Spot Rate   in 90 Days Probability $.61 10% $.63 20% $.64 40% $.65 30%  The probability that the forward hedge will result in more dollars received than not hedging is:

When currency options are traded over-the-counter and not standardized, there is ____ liquidity and a ____ bid/ask spread.

The premium on a pound put option is $.03 per unit. The exercise price is $1.66. The break-even point is ____ for the buyer of the put, and ____ for the seller of the put. (Assume zero transactions costs and that the buyer and seller of the put option are speculators.)

Which of the following is an example of economic exposure but not an example of transaction exposure?

If the Fed expects currency holdings to fall, it conducts open market ________ to offset the expected ________ in reserves.

The Federal Reserve entity that makes decisions regarding the conduct of open market operations is the

If the functional currencies for reporting purposes are relatively uncorrelated, translation exposure is lower than when significantly correlated.

If a bank has $100,000 of checkable deposits, a required reserve ratio of 20 percent, and it holds $40,000 in reserves, then the maximum deposit outflow it can sustain without altering its balance sheet is ___________________.

According to the IFE, if British interest rates exceed U.S. interest rates: