Currency forwards are good indicators of the future spot rate of a currency because they:
A) require that all parties trading in that currency at a specific future date value the currency at the same amount.
B) contractually bind entities to transaction business in the currency in the future at the current spot rate.
C) control what the future spot rate of the currency will be.
D) represent the estimation of future currency values by entities that have contracted for those rates in future transactions.
Correct Answer:
Verified
Q34: Purchasing power parity can arise when:
A)goods from
Q35: Purchasing Power Parity is:
A)the law of one
Q36: MNCs use currency forecasting in:
A)speculating in purchasing
Q37: The basis theory in using spot rates
Q38: Purchasing power parity can arise from two
Q40: Forward parity refers to:
A)the equality of a
Q41: Technical forecasting relies completely on:
A)computer models that
Q42: What is covered interest arbitrage?
Q43: The profit in a currency arbitrage transaction
Q94: What is the law of one price?
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents