If interest rate parity exists, then the rate of return achieved from covered interest arbitrage should be equal to the interest rate available in the foreign country.

Volusia, Inc. is a U.S.-based exporting firm that expects to receive payments denominated in both euros and Canadian dollars in one month. Based on today’s spot rates, the dollar value of the funds to be received is estimated at $300,000 for the euros and $500,000 for the Canadian dollars. Based on data for the last fifty months, Volusia estimates the standard deviation of monthly percentage changes to be 8 percent for the euro and 3 percent for the Canadian dollar. The correlation coefficient between the euro and the Canadian dollar is 0.30. Assuming an expected percentage change of 0 percent for each currency during the next month, what is the maximum one-month loss of the currency portfolio? Use a 95 percent confidence level and assume the monthly percentage changes for each currency are normally distributed.

According to the simple deposit multiplier model and assuming a required reserve ratio of [rr]%, an increase in the monetary base (MB) — driven by Fed open market purchases of $[D]00 m, will result in an increase in both Deposit and Loans of  $________ m. (Round your solution to the nearest whole number.) 

The mandate for the monetary policy goals that has been given to the European Central Bank is an example of a ________ mandate.

Currency devaluations have the potential to reduce unemployment, while currency revaluations have the potential to reduce inflation.

A 3.11 L sample of gas initially at 45.0 °C is cooled to 15.0 °C. If the pressure and number of moles constant, what is the final volume of the gas?

The trend in recent years is that more and more governments

The theory of bureaucratic behavior when applied to the Fed helps to explain why the Fed

An important financial institution that assists in the initial sale of securities in the primary market is the ___________________.

Federal deposit insurance covers deposits up to $250,000, but as part of a doctrine called “too-big-to-fail” the FDIC sometimes ends up covering all deposits to avoid disrupting the financial system. When the FDIC does this, it uses the _________________________.