The Foreign Exchange Market Has Two Main Functions

The foreign exchange market has two main functions:

A) to 'convert' the currency of one country into the currency of another, and to provide some 'hedge' or insurance against foreign exchange risk.
B) to allow a country to purchase any amount of a foreign currency, and to transfer assets between firms.
C) to facilitate short and long positions for developing nations selling commodities.
D) to host the tradeable wealth of nations, and to transfer the benefits from their transactions.