Question: True or false _____ If the Purchasing Power Parity holds, then there is no change in the real exchange rate. _____Options can be used to

True or false

_____ If the Purchasing Power Parity holds, then there is no change in the real exchange rate.

_____Options can be used to guarantee profits if the asset drops in value or if the asset goes up in value as long as the move is big.

_____ Covered interest rate arbitrage is possible only if the purchasing power estimate is not equal to the actual forward rate.

____ It is never advisable to call in an in the money option with 1 month left on it.

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