Assume the Following Information for a Bank Quoting on Spot

question 43

Multiple Choice

Assume the following information for a bank quoting on spot exchange rates​:
Based on the information given, as you and others perform triangular arbitrage, what should logically happen to the spot exchange rates?
Exchange rate of Singapore dollar in U.S $=$.32
Exchange rate of pound in U.S.$=$1.50
Exchange rate of pound in Singapore dollars=S$4.50

• A)The Singapore dollar value in U.S. dollars should appreciate, the pound value in U.S. dollars should appreciate, and the pound value in Singapore dollars should depreciate.
• B)The Singapore dollar value in U.S. dollars should depreciate, the pound value in U.S. dollars should appreciate, and the pound value in Singapore dollars should depreciate.
• C)The Singapore dollar value in U.S. dollars should depreciate, the pound value in U.S. dollars should appreciate, and the pound value in Singapore dollars should appreciate.
• D)The Singapore dollar value in U.S. dollars should appreciate, the pound value in U.S. dollars should depreciate, and the pound value in Singapore dollars should appreciate

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Definitions:

Partial Performance

The act of completing a portion of the obligations outlined in a contract, often considered in legal disputes about contract enforcement.

Respondeat Superior

A rule of law which makes an employer or principal accountable for an employee's or agent's wrongful actions, provided those actions were performed during the course of their employment or agency.

Delegatee

A person or party to whom duties or powers are delegated by another, often in a legal or organizational context.

Mortgages

Loans secured by real property, typically real estate, that borrowers use to purchase property or borrow against the value of property they already own.