BAFI3200 Week 3 The Mechanisms of Foreign Exchange Market
Authored by Dao Le Trang Anh
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University
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10 questions
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1.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
When a tourist goes to a bank in a foreign country to convert money into the local
currency, the exchange rate used is the forward rate.
True
False
2.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
To minimize the risk of an unanticipated change in exchange rates, a company can
protect itself by entering into a forward exchange contract.
True
False
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
If the forward rate of a currency pair is lower than the spot rate, which of the following statements is true?
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What does a forward premium indicate in the foreign exchange market?
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which of the following scenarios is most likely to result in a forward premium for a currency?
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is not a function of the forex market?
Currency Conversion
Risk Management
Speculation
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is American terms?
A foreign currency exchange quotation in terms of the amount of a foreign currency needed to buy one U.S. dollar
A direct quotation
An American currency quotation is how much U.S. currency it takes to buy one unit of foreign currency
An indirect quotation
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