If the U.S. interest rate is 4% and the forward premium for EUR/USD is 2%, and the interest rate in Germany is 3%, then interest rate parity is not violated and there is not an opportunity for an almost risk free profit.

True

False

By using a forward contract to "lock in"an exchange rate, we remove exchange rate risk.

True

False

Forward contracts have predefined specifications for characteristics like size and date.

True

False

There is virtually no risk using covered interest arbitrage to earn a profit.

True

False