What is forward exchange rate?

Q: What is the purchasing power exchange rate?

A: Purchasing power exchange rate is the rate at which one currency is converted into another currency…

Q: why do exporters and importers use bill of exchange?

A: A bill of exchange is a written order that binds one party to pay another party a predetermined sum…

Q: What are Eurodollars?

A: Eurodollars:It refers to the deposit of US dollars in the banks that are located outside the US (and…

Q: In the interest parity condition, why does the market exchange rate relate negatively to the…

A: The exchange rate is the rate at which currencies are exchanged for one another in the foreign…

Q: What is floating exchange rates?

A: Floating exchange rate: It is a scale is where the money cost of a country is set by the forex…

Q: Define the term exchange rate?

A: There are two types of exchange rates: floating and fixed. The floating exchange rate is determined…

Q: What are the trade bills?

A: Trade bills are also called Trade Acceptance / Accepted draft

Q: What is the basic difference between floating and fixed exchange rates?

A: Answer: Fixed exchange rate is where, when revaluation or devaluation happens, the exchange rate…

Q: Define currency appreciation

A: Answer: The meaning of currency appreciation is nothing but an rise of one currency’s value…

Q: Exchange rates fluctuate under both the fixed exchange rate and floatingexchange rate systems. What,…

A: Fixed exchange rate: Fixed exchange rate is formally set by the administration or monetary authority…

Q: What are pegged exchange rates?

A: Pegged exchange rate: It is otherwise called a fixed exchange rate, which is a kind of conversion…

Q: What is currency appreciation?

A: It is defined as the increase or improvement in the estimation of a national money over the…

Q: What is interest rate parity?

A: Interest rate parity: Interest rate parity is a theory concerning the association among spot…

Q: What is euro?

A: There are 28 Member States in the European Economic and Monetary Union (EMU), 19 of which have…

Q: What is an alternative trading system (ATS)?

A: Alternative trading systems are generally helpful for people like investors & professional…

Q: What is FX rate?

A: The exchange rate is that rate in which price of the country currency is measured in the term of the…

Q: WHAT ARE THE FEATURES AND TYPES OF FOREIGN TRADE?

A: Foreign trade are the trade between two or more countries.there are generally two types of trade…

Q: How can we establish economic equivalence by selecting the base period?

A: Answer: There is economic equivalence between cash flows which have the same economic influence and…

Q: What is an exchange rate?

A: Exchange is the price of one currency derived in another form of currency.

Q: Define Foreign currency hedge.

A: Hedge: The process through which the risk associated with a particular project, can be eliminated is…

Q: What is exchange rate risk?

A: Exchange rate risk It is a chance of occurrence of loss in the investment value because of uncertain…

Q: What is the benefits of floating exchange rates?

A: Floating Exchange Rate  refers to a methodology where price of currency of a nation is determined by…

Q: What is currency manipulation?

A: Introduction: Currency manipulation is considering as when countries purposely impact the exchange…

Q: What is cross-exchange rate? Give an example.

A: The exchange rate expresses the value of a currency in terms of another currency. It determines the…

Q: What is the difference between a spot rate anda forward exchange rate?

A: There are two types of currency exchange rates available namely forward exchange rate & spot…

Q: What effect does relative inflation have on interestrates and exchange rates?

A: Inflation is general increase in the prices. Inflation directly affects the exchange rate and…

Q: What is the difference between the time periods being measured with real income and exchange rates?

A: When referring to an individual's income, real income is the amount of money earned after inflation…

Q: What is an exchange rate? What is the differencebetween direct and indirect quotations? Whatis a…

A: Introduction: An exchange rate is the value of one currency stated in terms of another currency, or…

Q: Define currency swap

A: Introduction: This question is related to the concept of financial derivatives. Derivative…

Q: Define the term direct foreign investment?

A: The company is established to make a profit and it always keeps seeking investment opportunities…

Q: n the interest parity condition, why does the exchange rate relate negatively to the interest rate?

A: Interest rate parity theory is a theory that identifies the relationship between the spot exchange…

Q: Describe techniques for “hedging” againstlosses from fluctuations in exchange rates.

A: Hedging is the strategies used for reducing the risks and impacts of negative changes or…

Q: ith practical example ?

A: Currency risk, also called foreign-exchange risk or exchange-rate risk, is the risk that changes in…

Q: The functional currency is ?

A: Functional currency:

Q: What is the international monetary system?

A: International monetary system is the operating system and rules that govern the use of financial…

Q: What are three main stages at which could be considered the effect of exchange rates? Discuss them…

A: There are three main stages in the life of a transaction exposure that could be considered the…

Q: What is Currency options?

A: In the given question we need to define what is currency options.

Q: What is a Eurodollar?

A: Currency refers to the medium through which goods and services are exchanged. Basically, it's the…

Q: What is the difference between spot and forward exchange rates?

A: Commodity market involves different rates for products depending on the trading transactions. The…

Q: What is free trade credit?

A: Trade Credit is a type of credit financing extended by the trader or supplier of goods and services…

Currency Market

The currency market, also known as the foreign exchange market, consists of currencies worldwide. This market determines the rate of all currencies based on the buying and selling of forex. It is an over-the-counter market. It is the largest and most liquid market based on trade volume.