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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. 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?






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






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






4. How far in advance do we hedge?






5. How many currencies use Direct method of quoting?






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






7. An ___________ expresses the value of one currency relative to another






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






9. What rate is used to book daily transactions?






10. All other currency trading with USD accounts for ____ of FX volume






11. What dictates minimum and maximum hedge percentages?






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






13. The ticker symbol for the Chinese Yuan






14. How does treasury accomplish its purpose?






15. A forward happens in...






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






17. What are non-monetary accounts?






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






19. What is Functional Currency?






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






21. 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?






22. The currency ticker for the Sweden Kroner is?






23. What is local currency?

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24. In a GBP-USD relationship - when the line in a graph is upward slope it means the __________ overtime because the exchange rate is getting bigger






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






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






27. Forward points is equal to...






28. Direct quote- _____________=USD






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






30. What is the ticker symbol for Brazilian Real?






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






32. In general EUR-USD is involved in roughly ___ of all FX volume






33. How is the hedge rate variance calculated?






34. Australian currency code is...






35. 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






36. What is reporting currency?






37. A Spot happens in...






38. With direct quoting _______ of the first item is quoted for a specific price in terms of the second item.






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






40. A downward slope that represents AUD-USD relationship means that if you bought Australian dollars at point A - you have _____ money at point B






41. What instruments do we use to hedge?






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






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






44. We do not speculate on Foreign Exchange - 10-K says it is to reduce the impact of...






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






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






47. What currencies use Direct method of quoting?






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






49. If 1 Share = 10 USD and 1 CASE = 30 USD - then 1 share =?






50. What is Revaluation?

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