Foreign Exchange Market Concepts

How long is the foreign exchange market open

• 24 hours a day/ Five days a week

• 7 hours a day/ 24 days a week

• 24 Hours a day/ 7 Days a week

• 18 hours a day/ 7 days a week

What is a place where you can buy and sell anything right now?

• Foreign exchange market

• International Market

• Spot Market

• Forward Market

What is a market that is like a contract to buy or sell a currency in the future ?

• Forex Market

• International Market

• Forward Market

• Spot Market

Identical products, sold in two different markets, will be sold at the same price

• Minimal PPP

• Relative PPP

• Absolute PPP

• Law of One Price

What is the equilibrium (parity) of how much you can buy called?

• CIA

• IPR

• IRP

• PPP

What is a concept that you can simultaneously buy and sell an asset in a different market for a guaranteed, risk-free profit

• Foreign Exchange

• Arbitrage

• Interest

• Purchasing Power Parity

PPP and IRP are true in the long term except for what?

• Low Inventory Companies

• Minor Currencies

• Major Currencies

• High Inventory Companies

What causes the difference between the Argentina's official rate and the Argentina's black-market rate? Why

• Inflation and Government Control; Argentina has a fixed exchange rate set by the government, while the black-market reflects the actual demand.

• Supply and Demand; Argentina has a fixed exchange rate set by the government, while the black market reflects the actual demand

• Imports and Exports; Argentina has a fixed exchange rate set by the government, while the black-market reflects the actual market demand

Which market rate accurately reflects the true value of the Peso? The Black-Market rate or Official Rate?

• The Black Market Rate

• The Official Rate

A strong currency that is held in international central banks and governments as a safe asset for trade and saving

• Law of One Price

• Arbitrage

• Reserve Currency

• Spot Rate