Which of the following statements is true?
A)The historical rate is the exchange rate at the beginning of the reporting period, and the closing rate is the exchange rate at the end of the reporting period.
B)The historical rate is the exchange rate at the date of the transaction, and the closing rate is the exchange rate at the end of the reporting period.
C)The spot rate is the exchange rate at the date of the transaction, and the closing rate is the exchange rate at the conclusion of a hedge instrument.
D)The historical rate is the exchange rate at the beginning of the reporting period, and the forward rate is the exchange rate at the end of the reporting period.

Question

Quizplus · Accepted Answer

The historical rate is the exchange rate at the date of the transaction, and the closing rate is the exchange rate at the end of the reporting period. This is the correct definition of historical and closing rates. The spot rate is the exchange rate at the time of the transaction, and the forward rate is the exchange rate for a future transaction. Therefore, options A, C, and D are incorrect.

Which of the Following Statements Is True