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Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
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- If the U.S. interest rate is higher than the U.K. interest rate, will the U.K. investors place short-term funds in the U.S.? Explain. Assume the investment is covered. If the rate of inflation in the European Union (EU) is above the rate of inflation in the U.S., by 4 percentage points and the dollar depreciates against the euro by 5% during the same time period, what is expected to happen to the real exchange rate? The e exchange rate is defined as the dollar price of euro($/€).Analyze and explain the current state of the international monetary system. Then, discuss the effects of the U.S. dollar fluctuations on the American balance of payments.Discuss the possible effects of Ghana’s rising public Debt on the cedi to dollar exchange rate.
- if we to use the monetary approach to exchange rate determination, what would be the predicted effect on the xchange rate of domestic currency if domestic real income increasesThe Interest Rate Parity is one of the key international parity relationships that have profound implications for international financial management in the sense that it can be used in how foreign exchange rates are determined, and to forecast foreign exchange rates. The current spot exchange rate is $1.50/£ and the three-month forward exchange rate is $1.52/£. The three-month interest rate is 8.0% per annum in the U.S. and 5.8% per annum in the U.K. Assume that you can borrow as much as $1,500,000 or £1,000,000.Required:i. From the above information, determine whether the interest rate parity is currently holding. ii. If the IRP is not holding, how would you carry out covered interest arbitrage? Show all the steps and determine the arbitrage profit.iii. Explain how the IRP will be restored as a result of covered arbitrage activities.iv. Explain the conditions under which the forward exchange rate will be an unbiased predictor of the future spot exchange rate.v. Explain what Interest…Explain why you agree or disagree with each of the following statements:i) “A nation’s currency will depreciate if its inflation rate is less than that of its trading partners.”ii) “A nation whose interest rate falls more rapidly than that of other nations can expect the exchange value of its currency to depreciate.”iii) “A nation that experiences higher growth rates in productivity than its trading partners can expect the exchange value of its currency to appreciate.”
- Regarding to the recent movements in UK Pound/US Dollar spot exchangerate, critically discuss main causes of exchange rate volatility in the foreign exchangemarkets.During much of the 1800s, developed nations employed what came to be known as the ______________ international monetary system to manage exchange rates * Bretton Woods Gold Standard Fixed Regime Floating Regime