For most major currencies, which of the following time periods are common in forward exchange rate quotes?Question 8Select one:a.30 daysb.1 dayc.7 daysd.365 days
Question
For most major currencies, which of the following time periods are common in forward exchange rate quotes?Question 8Select one:a.30 daysb.1 dayc.7 daysd.365 days
Solution 1
The most common time periods for forward exchange rate quotes for most major currencies are typically 30 days (option a) and 365 days (option d). These periods are often used because they align with monthly and yearly financial and business cycles. However, the specific periods can vary depending on the currency, the financial institution, and the specific needs of the clients involved in the transaction.
Solution 2
The most common time periods for forward exchange rate quotes for most major currencies are typically 30 days and 365 days. Therefore, the correct answers would be:
a. 30 days d. 365 days
This is because forward exchange rates are typically quoted for standard periods of time, such as one month (30 days) or one year (365 days). These standard periods are used because they are the most common periods for which businesses and investors want to hedge their foreign exchange risk.
Similar Questions
What would be 3-months forward quote on USD/YEN if the spot rate is USD/YEN 114.35. Base currency interest rate per annum is 2%, whereas terms currency interest rate is 6% per annum.Question 9Select one:a.115.4878b.113.2234c.115.4723d.115.4778
A forward currency transaction:Select one:a.Is Always At A Premium Over The Spot Rateb.Means That Delivery And Payment Must Be Made Within One Business Day (Usa/Canada) Or Two Business Days After The Transaction Datec.Calls For Exchange In The Future Of Currencies At An Agreed Rate Of Exchanged.Sets The Future Date When Delivery Of A Currency Must Be Made At An Unknown Spot Exchange Rate
A bank has to submit a quote to a customer for buying Euro against Rupees. Thecustomer will have the option of taking delivery any time during the second month. Given thefollowing spot and forward rates, what rate should it quote? EUR/INRUSD/INR Spot : 55.20/55.30One month forward : 15/25Two month forward : 20/30EUR/USD Spot : 1.21/1.22One month forward : 15/10Two month forward : 20/15
Exchange rates are commonly quoted using acronyms for the national currencies they represent.
A bank has to quote a rate to its customer for purchase of a demand export bill withtransit period of 15 days. The interbank spot rate is Rs. 55.60 / $ and the one month forwardrate is Rs 56.00 / $. If the exchange margin charged by the bank is 0.1% what rate should thebank quote?
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.