The authors identify two tiers of foreign exchange markets:
A) bank and nonbank foreign exchange.
B) commercial and investment transactions.
C) interbank and client markets.
D) client and retail market.

Question

Quizplus · Accepted Answer

The authors identify interbank and client markets as the two tiers of foreign exchange markets. The interbank market refers to transactions between major banks and financial institutions, while the client market refers to transactions between these entities and their customers, including corporations, governments, and retail traders. This categorization is based on the type of market participants involved in each tier.

The Authors Identify Two Tiers of Foreign Exchange Markets