please answer the following 7 qustion:

1.Assume a central bank exchanges its currency for other foreign currencies in the foreign exchange market, and adjusts for the resulting change in the money supply simultaneously. This is an example of:

	A	indirect intervention.
	B	nonsterilized intervention.
	C	sterilized intervention.
	D	pegged intervention.

2.The current spot rate of pound is $1.80, and the 90-day forward rate of pound is $1.90. The pound has a forward ______ of ______.

	A	premium, 5.56%.
	B	premium, 4.87%.
	C	discount, 5,56%.
	D	discount, 4.87%.

3.Which one is a disadvantage of a freely floating exchange rate system?

	A	It can adversely affect a country that has high unemployment.
	B	It can adversely affect a country that has high inflation
	C	A country is more insulated from unemployment problem in other countries.
	D	a and b above.

4.If interest rates on the euro are consistently above U.S. interest rates, then for the international Fisher effect (IFE) to hold:

	A	the value of the euro would remain constant most of the time.
	B	the value of the euro would often depreciate against the dollar.
	C
	D	the value of the euro would appreciate in some periods and depreciate in other periods, but on average have a zero rate of appreciation.

5.American currency options can be exercised ____; European currency options can be exercised ____.

	A	only on the expiration date; only on the expiration date
	B	any time up to the expiration date; only on the expiration date
	C	any time up to the expiration date; any time up to the expiration date
	D	only on the expiration date; any time up to the expiration date

6.If you expect the British pound to depreciate, you could speculate by ____ pound call options or ____ pound put options.

	A	selling; purchasing
	B	selling; selling
	C	purchasing; purchasing
	D	purchasing; selling

7.A firm buys a currency futures contract, and then decides before the settlement date that it no longer wants to maintain such a position. It can close out its position by:

	A	selling a futures contract for a different amount of currency.
	B	selling an identical futures contract.
	C	buying an identical futures contract.
	D	buying a futures contract with a different settlement date.