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Country A has a higher interest rate relative to Country B; therefore Country As currencys futures will: a. provide a profitable arbitrage relative to country
Country A has a higher interest rate relative to Country B; therefore Country As currencys futures will:
a. provide a profitable arbitrage relative to country Bs currency.
b. sell at the same level of basis as Country Bs currency.
c. sell at a premium to Country Bs currency because of its higher interest rate.
d. the relationship between the two currencies cannot be determined
e. sell at a discount to Country Bs currency because of its higher interest rate.
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