NO.PZ2023071902000096
问题如下:
Question
Holding other factors constant, in a well-functioning market, an increase in which of the following will lead to a decline in the
forward exchange rate?
选项:
A.spot exchange rate. B.foreign risk-free interest rate. C.domestic risk-free interest rate.解释:
Solution
- Incorrect, since an increase in the spot exchange rate typically pushes the forward exchange rate upward, not downward.
- Incorrect, as an uptick in the international risk-free interest rate typically causes the forward exchange rate to ascend, rather than decline.
- Correct, based on the arbitrage relationship. The equation for the forward rate is denoted as:Ff/d = Sf/d × [(1 + if)/(1 + id)]], where Ff/d represents the forward exchange rate, if stands for the international risk-free interest rate, and id signifies the home country's risk-free interest rate. This formula suggests that when the home country's risk-free interest rate rises, it leads to a drop in the forward exchange rate.
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为什么解释里面forward exchange rate 是F(f/d) 而不是F(d/f) ?