The spot rate is simply the exchange rate between two currencies as determined by the respective governments.

The World Bank coordinates international currency exchange.

One function of the foreign exchange market is to provide some insurance against foreign exchange risk

Tourists are major participants in the foreign exchange market.

A forward contract specifies the currencies to be exchanged, an exchange rate, and a future date when the transaction will be completed

Under a floating (flexible) exchange rate system, the value of one currency relative to another is determined by the forces of supply and demand.

Most trading occurs among corporations and investors in secondary markets.

The international monetary system consists of institutions and mechanisms that foster international trade, manage the flow of financial capital, and determine currency exchange rates.

Future contracts takes place at a forward exchange rate to minimize riks.

A floating exchange rate enables currency value to fluctuate based on demand and supply.

Capital markets match large corporations who want to invest their surplus cash with the individuals who want to invest in the stock market.

The most significant consequence for investors of using the global capital market versus the domestic market is that investors can diversify their portfolios internationally, which allows them to reduce the cost of investment.

Stock prices are determined by the law of supply and demand.

Stock prices are set by companies and regulated by the government.