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






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






3. What is currency Translation?

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4. What is the trading in volume for FX?






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






6. Hedge Rate is _______________ that will be achieved on a specific quarter's cash flow






7. A Spot happens in...






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






9. What are non-monetary accounts?






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






11. What does it mean to hedge?






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






13. In a downward slope that represents USD-JPY relationship a _____________ means that if you bough Japanese Yen at point A you made money at point B






14. Forward points is equal to...






15. How is the hedge rate variance calculated?






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






17. A ____________________ is an exchange of two currencies at a fixed rate for any date other than spot delivery






18. What is cash flow used for?






19. If 1 case = 30 USD and 1 pizza = 15 USD - then What is 1 case = ?






20. What are monetary accounts?






21. What is the purpose of hedging?






22. How is the price of the forward contract determined?






23. What is reporting currency?






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






25. Functional currency of an entity is determined by Treasury Accounting based on ______ requirements






26. Hedging instrument used in Fair Value Hedge program is...






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






28. B/S rate is used for revaluation of foreign currency transaction to...






29. How many currencies use Direct method of quoting?






30. What rate is used to book daily transactions?






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






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






33. 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






34. In a stock-USD relationship - when arrow is going up means that stock is becoming more ______ against dollar






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






36. Where are revaluations done?






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






38. In a USD-JPY relationship - when the line in a graph is upward slope it means the yen is weakening and dollar is strenghtening because exchange rate...






39. The timing of when we execute hedges drastically impacts the ____________ we achieve






40. What rate is used on the balance sheet?






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






42. The ticker symbol for the Chinese Yuan






43. Give an example of one way to hedge a price increase in gas prices...






44. What is local currency?

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45. How far in advance do we hedge?






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






47. The rules for adding or subtracting forward points depend on whether it is quoted...






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






49. If the Mexico rate is 5.25%/year and the US is 0.25%/year - What is the rate that would be used to calculate the forward rate?






50. The Foreign Exchange market is the __________ market in the world