Test your basic knowledge |

Foreign Exchange Essentials

Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. How do you read EUR-USD = 1.40






2. The current market price for any currency pair is referred to as ?






3. Whether the quote was indirect or direct - they are all stored as ______ in Oracle






4. What rate is used on the P&L?






5. What is Fair Value hedge program used for?






6. One of the objectives of the hedge rate is to __________ that is used for pricing - planning - and accounting thus maximizing the efficiency of our hedge program






7. What is the purpose of hedging?






8. What are the exceptions to the ticker naming convention?






9. If you are an American planning a trip to Europe - which exchange rate would you rather have to convert your US Dollars to Euro? 1.40 or 1.60?






10. In a stock-USD relationship - when arrow is going down means that stock is becoming ____ valuable against dollar






11. USD-JPY account for ____ of trading FX volume






12. What is the trading in volume for FX?






13. The difference in interest rate is referred to as...






14. Hedging instrument used in cash flow program is...






15. If you are an European planning a trip to America - which rate do you want? 1.40 or 1.60?






16. In a EUR-USD relationship - when arrow is going up means Euro is strengthening and Dollar...






17. What is cash flow used for?






18. The ______________ for a currency normally uses the first two digits to identify the country - and the last digit to identify the currency






19. ____________ booked a hedge rate is trued up to the EHR each month during the quarter






20. GBP-USD account for ____ of trading FX volume






21. EUR-USD currency pair accounts for about ____ of all FX volume






22. In a EUR-USD relationship - when arrow is going down - means Euro weakens and US Dollar...






23. What rate is used on the balance sheet?






24. Revaluation can be hedged - while ___________ cannot be hedged






25. Treasury is responsible for managing companies funds and determining the firms'...






26. What rate is used to book daily transactions?






27. A downward slope that represents stock-USD relationship means that stock price is losing ______ - so you are losing money






28. US Treasuries is the second highest trading volume accounting for...






29. How does treasury accomplish its purpose?






30. Treasury is responsible for banking requirements - funding for the business and managing...






31. Hedge rate is constant throughout quarter while _______________ changes throughout quarter






32. What is the ticker symbol for Brazilian Real?






33. The offset of revaluation is recorded to...






34. When is hedge rate published?






35. What is local currency?

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36. What instruments do we use to hedge?






37. If 1 pizza = 15 USD then ____ = 1/15 pizza






38. Direct quote- _____________=USD






39. __________ is used for translation of foreign currency B/S to reporting currency






40. ____________ is used for translation of foreign currency P&L to Reporting currency?






41. What does it mean to hedge?






42. Effective Hedge Rate is ________________ of all outstanding FX contracts for the quarter being hedged






43. A Spot happens in...






44. Treasury ensures that companies have ____________ to meet its obligations






45. What is Functional Currency?






46. How far in advance do we hedge?






47. The currency ticker for the Sweden Kroner is?






48. Where are revaluations done?






49. What are some of the reason not hedge at all or partially hedge in a few countries?






50. The ticker symbol for the Chinese Yuan