When two parties agree to exchange currency and execute the deal immediately,the transaction is referred to as a ______________.

Question

Quizplus · Accepted Answer

A spot exchange refers to the immediate exchange of currencies between two parties, where the settlement date is usually two business days after the transaction date. This is different from a forward exchange where the parties agree to exchange currencies at a future date with a predetermined exchange rate. Therefore, option C is the correct answer as it describes the scenario accurately.

When Two Parties Agree to Exchange Currency and Execute the Deal