1. Suppose a country has persistent current account surplus. Which one of the following would cause country's currency to depreciate?
A. A massive capital inflow into the country because its economic prospects looks better than other countries.
B. Net financial and capital account deficit that is smaller than country's current account surplus
C. Net financial and capital account deficit that is larger than country's current account surplus
D. Net financial and capital account surplus that is smaller than country's current account surplus
2. Suppose you want to buy a STRIPS bond where you wish to purchase the final $1,000 face value of a Treasury bond. It currently sells for $682.4. If it pays semiannually and has a yield of 6%, calculate the time to maturity (in years).
12.93 years
6.56 years
6.46 years
13.12 years
None of the above