Which one of the following formulas correctly describes the relative purchasing power parity relationship?

Which one of the following formulas correctly describes the relative purchasing power parity relationship?    A.  E(St) = S0 × [1 + (hFC - hUS)]t B.  E(St) = S0 × [1 - (hFC - hUS)]t C.  E(St) = S0 × [1 + (hUS + hFC)]t D.  E(St) = S0 × [1 - (hUS - hFC)]t E.  E(St) = S0 × [1 + (hUS - hFC)]t Refer to section 21.3

35.

Which one of the following statements is correct given the following exchange rates?        A.  On Thursday, one U.S. dollar was equal to 0.1023 South African rand. B.  On Friday, one Thai baht was equal to $35.21. C.  Both the South African rand and the Thai baht appreciated against the U.S. dollar from Thursday to Friday. D.  The South African rand appreciated from Thursday to Friday against the U.S. dollar. E.  The U.S. dollar depreciated from Thursday to Friday against the Thai baht. Refer to section 21.2

36.

Which of the following variables used in the covered interest arbitrage formula are correctly defined? I. RFC: Foreign country nominal risk-free interest rate II. RUS: U.S. real risk-free interest rate III. F1: 360-day forward rate IV. S0: Current spot rate expressed in units of foreign currency per one U.S. dollar    A.  I and II only B.  III and IV only C.  I, III, and IV only D.  II, III, and IV only E.  I, II, III, and IV Refer to section 21.4

37.

Interest rate parity:    A.  eliminates covered interest arbitrage opportunities. B.  exists when spot rates are equal for multiple countries. C.  means the nominal risk-free rate of return must be the same across countries. D.  exists when the spot rate is equal to the futures rate. E.  eliminates exchange rate fluctuations. Refer to section 21.4

38.	The interest rate parity approximation formula is:    A.  Ft = S0 × [1 + (RFC + RUS)]t. B.  Ft = S0 × [1 - (RFC - RUS)]t. C.  Ft = S0 × [1 + (RFC - RUS)]t. D.  Ft = S0 × [1 + (RFC × RUS)]t. E.  Ft = S0 × [1 - (RFC + RUS)]t. Refer to section 21.4