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Assume the MNC hedges interest rate arbitrage against EUR. Interest rate parity exists. The effective rate of return will _______ the domestic interest rate if

Assume the MNC hedges interest rate arbitrage against EUR. Interest rate parity exists. The effective rate of return will _______ the domestic interest rate if the future spot rate of the euro _______ the forward rate. a. Higher, lower. b. Lower, higher. c. Lower, lower. d. No sentence correctly.

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