From uncovered interest parity, we know that when the domestic interest rate is greater than the foreign one:

a. the domestic currency is expected to appreciate.
b. the domestic currency is expected to depreciate.
c. the foreign currency is expected to appreciate.
d. the foreign currency is expected to depreciate.

Ans: b. the domestic currency is expected to depreciate.

Economics

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a. True b. False Indicate whether the statement is true or false

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Rational people make decisions at the margin by

a. following marginal traditions. b. behaving in a random fashion. c. thinking in black-and-white terms. d. comparing marginal costs and marginal benefits.

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