Currency Speculation Takes Place When

question 38

Multiple Choice

Currency speculation takes place when

• A) there is short-term movement of funds from one currency to another in the hopes of profiting from shifts in exchange rates.
• B) the exchange rate at which a foreign exchange dealer will convert one currency differs on a particular day.
• C) there is a simultaneous purchase and sale of a given amount of foreign exchange for two different value dates.
• D) the purchase of securities in one market are immediately resold in another to profit from a price discrepancy.
• E) the growth in a country's money supply exceeds the growth in its output, leading to price inflation.

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Definitions:

Disclosed Principal

In agency law, a principal whose identity is known by the third party at the time the agent makes a contract with the third party.

Doctrine of Estoppel

A legal principle that prevents a party from denying or asserting anything to the contrary of what has previously been established as truth.

Expressly Bind

To explicitly or distinctly commit or obligate oneself or an entity to an agreement or course of action.

Unidentified Principal

Refers to a situation in agency law where an agent acts on behalf of a principal, but the identity of the principal is not disclosed to the third party.