You are an active currency trader in the dollar versus euro market.The current market quote ($/€)is 1.51-1.55.However,you believe the dollar will appreciate versus the euro.Which of the following quotes is the most likely one you will present to the market given your views?
A)1.52-1.56
B)1.50-1.54
C)1.50-1.57
D)1.52-1.54

Question

Quizplus · Accepted Answer

if you think the dollar will appreciate versus the euro,you want to buy dollars now,i.e. ,sell euros.To sell euros you drop the ask price on the euros from 1.55 to 1.54 so that anyone wanting to buy euros will prefer to come to you than the others in the market because your ask price is cheaper.But you also want to dissuade everyone from selling you euros,so by dropping the bid price from 1.51 to 1.50,you make it unattractive for them to do so.

You Are an Active Currency Trader in the Dollar Versus