Which of the following is the most important foreign exchange trading center? A) London B) New York C) Tokyo D) Singapore
Which of the following refers to the simultaneous purchase and sale of a given amount of foreign exchange for two different value dates? A) Currency pairing B) Carry trade C) Currency exchange D) Currency swap
Assume that the yen/dollar exchange rate quoted in Tokyo at 3:00 p.m.is ¥120 = $1,and the yen/dollar exchange rate quoted in New York at the same time is ¥123 = $1.A dealer in New York uses dollars to purchase yen and then immediately sells the yen to buy dollars in Tokyo,thereby making a profit.The dealer has engaged in a(n): A) currency swap. B) arbitrage. C) carry trade. D) straddle.
If the demand for dollars outstrips its supply and if the supply of Japanese yen is greater than the demand for it,what will happen? A) The dollar will appreciate against the yen B) The dollar will depreciate against the yen C) The exchange rates will remain the same D) The yen will appreciate against the dollar