Which of the following parties are participants in the foreign exchange market?
I.U.S.importers
II.U.S.exporters
III.U.S.travelers to Europe
IV.Foreign portfolio managers who purchase American securities

Question

Quizplus · Accepted Answer

All four parties mentioned are participants in the foreign exchange market. U.S. importers and exporters engage in foreign exchange transactions to pay for or receive payment for international trade. U.S. travelers to Europe exchange their currency for euros to pay for expenses abroad. Foreign portfolio managers who purchase American securities exchange their currency for dollars to buy these securities, which involves foreign exchange transactions. Therefore, all four parties are participants in the foreign exchange market.

Which of the Following Parties Are Participants in the Foreign