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Foreign Exchange Market

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. What is externally convertible currency






2. What are other strategies for managing forex risk?






3. What are some characteristics of swaps?






4. What are the important trading centers?






5. What is the second characteristic of lead strategy?






6. What is the nature of the forex market?






7. How can translation exposure be described?






8. Greece has not defaulted because it has not been able to fully implement its...






9. What are the two ways to quote currency?






10. What are three factors that impact a country's future exchange rate movements?






11. In the long run empirical testing has of the PPP Theory has proven to be accurate in the long run. True or False






12. What is a currency swamp?






13. What are the purposes of fiscal policies?






14. How can transaction exposure be described?






15. What is the characteristic of translation expose?






16. When do countries use the foreign exchange market?






17. What is non convertible currency?






18. What causes big mac prices to vary?






19. What is the third role of the U.S. dollar outside the U.S.?






20. What is the second role of the U.S. dollar outside the U.S. ?






21. What is a forward rate?






22. What holds true to Purchase Power Parity Theory?






23. What is the purpose of not concentrating assets in countries?






24. What is the second characteristic of transaction exposure?






25. What are the two ways to reduce economic exposure?






26. What do monetary policies do?






27. According to economic theories of exchage rate determination?






28. Because many banks (2/3) are below the capital adequacy ratio of 9% many can not recapitalize on their own as a result






29. When do countries use foreign exchange market?






30. What is the fourth characteristic of transaction exposure?






31. What is the nominal exchange rate?






32. What is arbitrage?






33. What are some strategies for managing forex risk?






34. What is the fourth thing that determines the forex rates?






35. What is free convertible currency?






36. No single theory can explain explain the causes the value of currencies to change. True or False?






37. Currently margins require more cash reserves - What is the best method of doing this **** in the Euro Zone?






38. What is the first characteristic of lead strategy?






39. What is the first characteristic of lag strategy?






40. What is the third thing that determines the forex rates?






41. What is the bandwagon effect when looking at form investor psychology ?






42. The euro faces risks fo recapitalization?






43. What are some factors that influence exchange rates?






44. What is the fifth thing that determines the forex rates?






45. What are the types of Exchange Rate Fluctuations?






46. How do you establish central control?






47. What is hedging?

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48. Marekts are open...






49. What are the characteristics of economic exposure?






50. How and What is the purpose of distributing assets?