- CFA Exams
- CFA Level I Exam
- Study Session 4. Economics
- Reading 10. Currency Exchange Rates: Understanding Equilibrium Value
- Subject 3. A Long-Term Framework for Exchange Rates
CFA Practice Question
Uncovered interest rate parity states/implies that ______ are good predictors of future spot exchange rates.
A. Current spot exchange rates.
B. Forward exchange rates.
C. Expected forward exchange rates.
Explanation: It implies that forward exchange rates are unbiased predictors of future spot exchange rates.
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