A simultaneous purchase and sale of foreign exchange for two different dates is called

Related MCQs

• A _______ involves an exchange of currencies between two parties, with a promise to re-exchange currencies at a specified exchange rate and future date.
• A _______ involves an exchange of currencies between two parties, with a promise to re- exchange currencies at a specified exchange rate and future date.
• A firm that buys foreign exchange in order to take advantage of higher foreign interest rates is
• When the foreign exchange market opens in the UK each morning, the opening exchange rate quotations will be based on the:
• Under a fixed exchange standard, if the domestic demand for foreign exchange increases
• When the foreign exchange market opens in the UK each morning, the opening exchange rate quotations will be based on the:
• A foreign project generates a negative cash flow in year 1 and positive cash flows in years 2 through 5. The NPV for this project will be higher if the foreign currency _________ in year 1 and _________ in years 2 though 5.
• When a foreign subsidiary is not wholly owned by the parent and a foreign project is partially financed with retained earnings of the parent and of the subsidiary, then:
• Magent ltd. is a UK company that has exposure to the Swiss franc (SF) and Danish kroner (DK). It has net inflows of SF 200 million and net outflows of DK 500 million. The present exchange rate of the SF is about £0.22 while the present exchange rate of the DK is £0.05. Magent ltd. has not hedged these positions. The SF and DK are highly correlated in their movements against the pound. If the pound weakens, then Magent ltd. will:
• If more European and Japanese firms want to build factories and expand their offshore investments in the United States, the supply of U.S. dollars on foreign exchange markets will increase as a result of this investment activity.