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Assume the interest rate is 4%in the US and 3%in Euroland. Which of the following statements about UIP are correct? UIP will never hold for
Assume the interest rate is 4%in the US and 3%in Euroland.
Which of the following statements about UIP are correct?
UIP will never hold for these numbers.
UIP predicts that the dollar is expected to appreciate by 1%.
UIP predicts that the dollar is expected to depreciate by1%
If the expected rate of depreciation of the dollar is 1%, then UIP holds.
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