If you are a currency speculator, you will always make money by:
A)Buying currency with high interest rate
B)Buying currency with low interest rate
C)Accurately predicting whether exchange rate will change more or less than the interest rate differential
D)Buying the currency with the highest interest rate differential

Question

Quizplus · Accepted Answer

Currency speculators make money by accurately predicting whether the exchange rate will change more or less than the interest rate differential. They can profit from the difference in prices between currencies by buying low and selling high. Merely buying the currency with high or low interest rates or the highest interest rate differential does not guarantee profits. It is crucial to analyze the factors that affect the exchange rate and how it relates to interest rates movements.

If You Are a Currency Speculator, You Will Always Make