Economics · International Finance
Speculators will buy a currency through a forward market contract if which of the following conditions is met?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The future spot rate of the currency is not expected to change
- 2The future spot rate is expected to be equal to the forward rate
- 3The future spot rate of that currency is expected to be higher than the forward rate✓
- 4The future spot rate of that currency is expected to be lower than the forward rate
Correct answer
The future spot rate of that currency is expected to be higher than the forward rate
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