Inflation Rates MCQ (Multiple Choice Questions) PDF Download

The theory according to which the difference between expected appreciation and foreign interest must be equal to domestic interest rate, is called

1. interest rate parity theorem
2. appreciation parity theorem
3. domestic parity theorem
4. foreign interest parity theorem

The rule which states that similar set of goods and services produced in various countries should have equal price is classified as

1. law of similar mortgage rate
2. law of one type manufacturing
3. law of similar labor rules
4. law of one price

In equilibrium position, the spread between foreign and domestic rate of interest must be equal to spread of

1. domestic rates
2. forward and spot exchange rates
3. forward rate
4. spot rates

The theory which considers the change in exchange rate with the fluctuations in inflation rates is classified as

1. liquidated power parity
2. purchasing power parity
3. selling power parity
4. volatile power parity

The inflation rate in United States is added into real rate of interest to calculate

1. quoted interest rate in United States
2. nominal interest rate in United States
3. interest rate in United States
4. discount rate of country