Question: 1. A slowdown in U.S. economic growth will ____the value of the dollar because____. A. Depreciate, the U.S. will be a less attractive place to

1. A slowdown in U.S. economic growth will ____the value of the dollar because____.

A. Depreciate, the U.S. will be a less attractive place to investors.

B. Increase, inflation fears will be calmed.

C. Decrease, interest rates will rise.

D. Increase, the U.S. federal reserve bank will expand the money supply.

2. According to the ____ theory, the ___in a currecy market are ____ indicators of the future____rates.

A. Unbiased forward rate, spot rates, unbiased, forward

B. Interest rate parity, spot rates, unbiased, forward

C. Unbiased forward rate, forward rates, unbiased, spot

D. Unbiased forward rate, spot rate, biased, forward

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