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. What are some factors that influence exchange rates?






2. When do countries use foreign exchange market?






3. How do you establish central control?






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






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






6. What is externally convertible currency






7. What is non convertible currency?






8. What is the fourth characteristic of transaction exposure?






9. What are the first two things that determine Forex rates?






10. What are the important trading centers?






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






12. What is the law of one price?






13. How can transaction exposure be described?






14. What is arbitrage?






15. What do monetary policies do?






16. What is a currency swamp?






17. What are some characteristics of swaps?






18. What is the first characteristic of transaction exposure ?






19. What is the second characteristic of lag strategy?






20. What are some strategies for managing forex risk?






21. Most Transaction inovolve...






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






23. What is the first issue with EFSF?






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






25. What is the real exchange rate?






26. What is the fourth roles of the U.S. dollar outside the U.S.?






27. What is the nature of the forex market?






28. What is the second characteristic of lead strategy?






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






30. What is a forward rate?






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






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






33. What is the first characteristic of lead strategy?






34. What is free convertible currency?






35. What are the types of Exchange Rate Fluctuations?






36. Defaulting on debt has a __________ that intertwines all countries in Europe.






37. What is the first characteristic of lag strategy?






38. What is the second thing that determines the Forex rates?






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






40. What are other strategies for managing forex risk?






41. What causes big mac prices to vary?






42. What is the second issue with EFSF?






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






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






45. According to economic theories of exchage rate determination?






46. What are the characteristics of economic exposure?






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






48. What are the purposes of fiscal policies?






49. Burger economics!!! Why do we use it?






50. The euro faces risks fo recapitalization?