The most important (in terms of dollar value) type of foreign exchange transaction by U.S. banks is the .
A. Spot transaction
B. Forward transaction
C. Swap transaction
D. Option transaction
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The exchange rate is kept the same in all parts of the market by .
A. Forward cover
B. Hedging
C. Exchange speculation
D. Exchange arbitrage
Consider Table 1. Comparing Tuesday to the previous Monday, by Tuesday the dollar had .
A. Depreciated against the pound
B. Appreciated against the pound
C. Not changed against the pound
D. None of the above
Suppose that a Swiss watch that costs 400 francs in Switzerland costs $200 in the United States. The exchange rate between the franc and the dollar is .
A. 2 francs per dollar
B. 1 franc per dollar
C. $2 per franc
D. $3 per franc
In the interbank market for foreign exchange, the refers to the difference between the offer rate and the bid rate.
A. Cross rate
B. Option
C. Arbitrage
D. Spread