The table below shows some actual data concerning exchange rates and the prices of SuperDuper Burgers in the summe Actual Exchange Rate SuperDuper Burgers 5.35 6.4 4.7 15.36 Location Toronto Switzerland Singapore Hong Kong Switzerland: 0.83 Singapore: $ 1.13 Hong Kong $ Swiss francs. Singapore. Canadian dollars Swiss francs Singapore dollars Hong Kong dollars Hong Kong. $1 Canadian $1 Canadian $1 Canadian M M a. Assuming purchasing power parity, what should the price of SuperDuper Burgers be in the three countries? Round your a decimal places. m 0.91 Swiss francs 1.27 Singapore dollars 7.71 Hong Kong dollars b. Compared with the actual prices of SuperDuper Burgers in the three countries, are the actual exchange rates overvalu undervalued?

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Instruments of Foreign Exchange Market

Foreign exchange is a worldwide market in which one nation’s currency is converted into another nation’s currency. In further terms, exchanging of nations currency with foreign currencies. Foreign exchange happens at a specified rate which is termed the foreign exchange rate. The exchange rates are not constant continuously changing as they are derived by market forces of supply and demand. Widely used foreign currencies are the United States- dollar, Euro, Japanese Yen, British pound, and Australian dollar. US- dollar is the most denominated foreign currency. The Euro to US dollar is a widely used currency pair in the forex market as these two currencies represent the world’s enormous economy. Forex trade is simple as exchanging currencies at the bank. The main players of forex markets are the central banks, financial institutions, intermediaries, investments banks, and other banks. Central Bank is the supreme player who decides the currency value of their own nation on the forex market. Mostly foreign exchange-traded at FX market (forex market) when tourists’ visits a foreign country, import, and export happens between two countries.