A product's _____ is most likely to influence the purchase decision of the consumers.

1 answer:

7 0

The answer is the product’s quality. It is because the overall quality of the product is the main reason why consumers want to buy the product because the quality is the characteristic of the product possess and this will greatly affect the consumers, especially if they like the product’s quality.

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Assume that a currency's spot and future prices are the same, and the currency's interest rate is higher than the U.S. rate. The

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put upward pressure on; put downward pressure on

The actions of U.S. investors to lock in this higher foreign return would PUT UPWARD PRESSURE ON the currency's spot rate and PUT DOWNWARD PRESSURE ON the currency's futures price.

Explanation:

If both the spot and the forward price of a currency are the same, it means that it should be worth the same today than in the future. If you can earn higher interest by investing in that foreign currency, then investors will start purchasing higher amounts of the foreign in order to invest and gain higher rates.

Since the demand for the foreign currency increases, that put upward pressure its current price. Simply more investors will want to invest in that currency. While that happens right now, the market will tend to adjust to correct this arbitrage, and the way this can be adjusted is by lowering the future price of the currency. That puts downward pressure on the forward rate.

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