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Corporate Finance · End Term · 10 May 2026 · January 2026 term · Set 1

Question 18: Suppose that the interest rate at a point in time in the…

Question 18

+3 marksOne correct option

Suppose that the interest rate at a point in time in the domestic economy is 4%, and the interest rate in the foreign economy at that point in time is 9%. What is the expected rate of appreciation of the domestic exchange rate at that point in time?

  1. A

    -4.81%

  2. B

    -2.86%

  3. C

    2.86%

  4. D

    4.81%

Show answer

Correct answer

  • D

    4.81%

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Question 18 of 35 in the IIT Madras BS Corporate Finance (Corporate Finance) End Term paper sat on 10 May 2026, in the January 2026 term (Corporate Finance 06 May 26). It carries 3 marks.

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