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Foreign Exchange

Which of the following is not a reason why Joe Smith (an American) might participate as a demander in the foreign exchange market ?

Economics Mcqs, Foreign Exchange /
Which of the following is not a reason why Joe Smith (an American) might participate as a demander in the foreign exchange market ?

A. his desire to open a bank account in Japan
B. his desire to purchase an automobile produced domestically
C. his desire to travel to Europe
D. his desire to purchase Treasury bills issued by the British government

Which of the following is not a reason why Joe Smith (an American) might participate as a demander in the foreign exchange market ? Read More »

Economics Mcqs, Foreign Exchange

If Sweden’s currency depreciates relative to Norway’s currency ?

Economics Mcqs, Foreign Exchange /
If Sweden’s currency depreciates relative to Norway’s currency ?

A. Norway’s export goods become more expensive to Norway’s residents
B. Norway’s exports goods become cheaper to Sweden’s residents
C. Sweden’s export goods become cheaper to Norway’s residents
D. Sweden’s export goods become cheaper to Sweden’s residents

If Sweden’s currency depreciates relative to Norway’s currency ? Read More »

Economics Mcqs, Foreign Exchange

The franc is said to be selling at a _______ if the spot dollar price is $0.48 and the nine-month forward rate is $0.42 ?

Economics Mcqs, Foreign Exchange /
The franc is said to be selling at a _______ if the spot dollar price is $0.48 and the nine-month forward rate is $0.42 ?

A. forward discount
B. forward premium
C. forward spread
D. None of these

The franc is said to be selling at a _______ if the spot dollar price is $0.48 and the nine-month forward rate is $0.42 ? Read More »

Economics Mcqs, Foreign Exchange

Riskless transactions to take advantage of profit opportunities due to a price differential or a yield differential in excess of transaction costs are called ?

Economics Mcqs, Foreign Exchange /
Riskless transactions to take advantage of profit opportunities due to a price differential or a yield differential in excess of transaction costs are called ?

A. differential actions
B. cash transaction
C. arbitrage
D. forward transactions

Riskless transactions to take advantage of profit opportunities due to a price differential or a yield differential in excess of transaction costs are called ? Read More »

Economics Mcqs, Foreign Exchange

An important feature of a _______ is that the holder has the right but not the obligation to buy or sell currency ?

Economics Mcqs, Foreign Exchange /
An important feature of a _______ is that the holder has the right but not the obligation to buy or sell currency ?

A. Swap
B. foreign exchange arbitrage
C. foreign exchange option
D. futures market contract

An important feature of a _______ is that the holder has the right but not the obligation to buy or sell currency ? Read More »

Economics Mcqs, Foreign Exchange

In a supply and demand diagram for Japanese yen, with the exchange rate in dollars per yen on the vertical axis, the demand schedule for yen is drawn sloping ?

Economics Mcqs, Foreign Exchange /
In a supply and demand diagram for Japanese yen, with the exchange rate in dollars per yen on the vertical axis, the demand schedule for yen is drawn slog ?

A. upward
B. vertical
C. downward
D. horizontal

In a supply and demand diagram for Japanese yen, with the exchange rate in dollars per yen on the vertical axis, the demand schedule for yen is drawn sloping ? Read More »

Economics Mcqs, Foreign Exchange

During the era of dollar appreciation from 1981 to 1985 a main reason why the dollar did not fall in value was ?

Economics Mcqs, Foreign Exchange /
During the era of dollar appreciation from 1981 to 1985 a main reason why the dollar did not fall in value was ?

A. flows of foreign investment into the United States
B. rising price inflation in the United States
C. a substantial decrease in U.S imports
D. a substantial increase in U.S exports

During the era of dollar appreciation from 1981 to 1985 a main reason why the dollar did not fall in value was ? Read More »

Economics Mcqs, Foreign Exchange