6. Based on the previous question, what is the one-year forward exchange rate that should prevail? A. 1.00 = $1.6157 B. 1.6157 = $1.00 C. 1.00 = $1.5845 D. 1.5845= $1.00 7. Purchasing Power Parity (PPP) theory states that A. the exchange rate between currencies of two countries should be equal to the ratio of the countries' price levels. B. as the purchasing power of a currency sharply declines (due to hyperinflation) that currency will depreciate against stable currencies. C. the prices of standard commodity baskets in two countries are not related. D. both a) and b) 8. Interbank foreign exchange traders use a shorthand abbreviation in expressing spot currency quotations. Consider a $/ bid-ask quote of $1.9056-$1.9065. The currency dealer would likely quote that as 65-56. A. B. True False 9. The excessive trading could lead to loss of stock investment. Which of the following biases is the most related to excessive trading? A. Overconfident B. Confirmation bias C. Conservatism 10. Sometimes, individuals hang on to bad investments and projects hoping that something will happen that will allow them to break even and thereby escape without a loss. This is an example of A. Prospect theory B. House money C. Heuristics D. Overconfident 6. Based on the previous question, what is the one-year forward exchange rate that should prevail? A. 1.00 = $1.6157 B. 1.6157 = $1.00 C. 1.00 = $1.5845 D. 1.5845= $1.00 7. Purchasing Power Parity (PPP) theory states that A. the exchange rate between currencies of two countries should be equal to the ratio of the countries' price levels. B. as the purchasing power of a currency sharply declines (due to hyperinflation) that currency will depreciate against stable currencies. C. the prices of standard commodity baskets in two countries are not related. D. both a) and b) 8. Interbank foreign exchange traders use a shorthand abbreviation in expressing spot currency quotations. Consider a $/ bid-ask quote of $1.9056-$1.9065. The currency dealer would likely quote that as 65-56. A. B. True False 9. The excessive trading could lead to loss of stock investment. Which of the following biases is the most related to excessive trading? A. Overconfident B. Confirmation bias C. Conservatism 10. Sometimes, individuals hang on to bad investments and projects hoping that something will happen that will allow them to break even and thereby escape without a loss. This is an example of A. Prospect theory B. House money C. Heuristics D. Overconfident