Explain the concept of market efficiency

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Reference no: EM132067201

1. With particular reference to the forward exchange rate, explain the concept of market efficiency and the importance of expectations formation in the assessment of an efficient market?

2. Identify the inflation rate of your home country and some well known foreign country. Then identify the percentage change of your home currency with respect to that foreign country. Did the currency change in the direction and by the magnitude that you would have expected according to PPP?

Reference no: EM132067201

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