Research undertaken by Meese & Rogoff at the Federal Reserve in 1983, which has been duplicated many times since, suggested

Group of answer choices

A. that orthodox models of exchange rates could play a valuable role in forecasting future movements in exchange rates, which was of interest to central banks at the time.

B. that orthodox models of exchange rates cannot forecast future exchange rates better than a random walk, at time horizons of up to a year, even when the forecaster is able to put into those models the actual future values of all variables of interest except the exchange rate itself.

C. that the random walk model, alongside orthodox models of exchange rates, could play a valuable role in forecasting future movements in exchange rates, which was of interest to central banks at the time.

D. That orthodox models of exchange rates cannot forecast future exchange rates better than a random walk, at time horizons of up to a year, but that this was consistent with efficient markets theory and the 'news model' of exchange rates

E. that the random walk model exchange rates could play a valuable role in forecasting future movements in exchange rates, which was of interest to central banks at the time.