Test your basic knowledge |

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. How can translation exposure be described?






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






3. What are some strategies for managing forex risk?






4. What are the types of Exchange Rate Fluctuations?






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






6. It is important to stay __________ with your current events






7. What causes big mac prices to vary?






8. What is the real exchange rate?






9. What is the first characteristic of lag strategy?






10. What is the second issue with EFSF?






11. When do countries use the foreign exchange market?






12. How do you establish central control?






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






14. What do monetary policies do?






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






16. What implications does understanding foreign exchange rates have on managers?






17. What is the first characteristic of lead strategy?






18. What is the second characteristic of lag strategy?






19. Because of the recessionary environment euro banks have failed to do what?


20. Bailout Fund of EFSF - What is this shiz nitz?






21. What are some factors that influence exchange rates?






22. How do you insure or hedge against a Forex risk?






23. How can transaction exposure be described?






24. The euro faces risks fo recapitalization?






25. What are the two ways to quote currency?






26. What is the first issue with EFSF?






27. What are the three different types of foreign exchange rate risks?






28. What is the law of one price?






29. Most Transaction inovolve...






30. What is externally convertible currency






31. What is hedging?


32. When do countries use foreign exchange market?






33. What is the second characteristic of transaction exposure?






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






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






36. What are two methods of reducing translation and transaction exposure?






37. What are the three ways of insuring against a Forex risk?






38. Marekts are open...






39. What is the first characteristic of transaction exposure ?






40. What is the nature of the forex market?






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






42. What are the important trading centers?






43. What is capital fight when looking at it form investor psychology?






44. What holds true to Purchase Power Parity Theory?






45. What is the first roels of the U.S. dollar outside the U.S.?






46. What is the fourth characteristic of transaction exposure?






47. What is economic exposure?






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






49. What are other strategies for managing forex risk?






50. What are the characteristics of economic exposure?