A forward exchange market contract obligates the owner to make a trade at a specified exchange rate a fixed number of days in the future.

Question

Quizplus · Accepted Answer

A forward exchange market contract is a binding agreement between two parties to exchange a specified amount of currency at a predetermined exchange rate, on a future date, typically 30, 60, or 90 days in the future. The owner of the contract is obligated to make the trade at the agreed-upon exchange rate on the specified date.

A Forward Exchange Market Contract Obligates the Owner to Make