In general,the foreign exchange dealer's bid-offer spread _______ with time to settlement.
A) is not concerned
B) increases
C) decreases
D) narrows

Question

Quizplus · Accepted Answer

As time to settlement increases, the risk involved in the transaction also increases. This causes foreign exchange dealers to widen their bid-offer spread, resulting in a higher cost for the customer. Therefore, the correct answer is option B "increases".

In General,the Foreign Exchange Dealer's Bid-Offer Spread _______ with Time