1.

If a one year Italian bond has an interest rate of 5.1% and a one year Swiss bond has an interest rate of 4.31%, the current exchange rate Et = 4.8 sfleuro (swiss francs per euro) and the expected exchange rate in t+1 is Et + 1 = 4.71 sf/euro, an Italian investor would prefer to invest in a bond and UIP hold. O A. an Italian bond or a Swiss bond; does O B. a Swiss bond; does O C. an Italian bond; does not O D. a Swiss bond; does notWhen looking at the balance of payments accounts, we can deduce the nature of the imbalances in a country's accounts. If we know that China has a current account surplus, then we know with certainty that this will be reflected in: O A. an increase in foreign holdings of Chinese assets larger than the increase in Chinese holdings of foreign assets O B. its financial account surplus and a statistical discrepancy of zero O C. its trade deficit and negative net income balance O D. an increase in Chinese holdings of foreign assets larger than the increase in foreign holdings of Chinese assets