The key factor in the ________ side of foreign currency trading is _________.
A) fear; the differential between domestic and foreign interest rates
B) greed; the differential between domestic and foreign interest rates
C) fear; capital loss due to a currency gaining value
D) greed; capital loss due to a currency losing value

Question

Quizplus · Accepted Answer

The key factor on the greed side of foreign currency trading is the differential between domestic and foreign interest rates. This differential can motivate investors to engage in currency trades to benefit from higher interest rates in another country, reflecting the pursuit of profit, which is associated with greed.

The Key Factor in the ________ Side of Foreign Currency