CFA Practice Question

There are 253 practice questions for this study session.

CFA Practice Question

If you state that the forward exchange rate is an unbiased predictor of the spot exchange rate, you are basically implying:

A. Covered interest rate parity holds.
B. Uncovered interest rate parity holds.
C. The international Fisher effect holds.
Correct Answer: B

User Contributed Comments 2

User Comment
davidt876 why not covered? i thought uncovered only considered the interest rate differential and the spot rate? while covered links in forward exchange rates..
warnggg Shouldn't this be Forward Rate Parity?
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