Which of the Following Is an Example of Triangular Arbitrage

question 52

Multiple Choice

Which of the following is an example of triangular arbitrage initiation?​

• A) ​buying a currency at one bank's ask and selling at another bank's bid, which is higher than the former bank's ask
• B) ​buying Singapore dollars from a bank (quoted at $.55) that has quoted the South African rand (SAR)/Singapore dollar (S$) exchange rate at SAR2.50 when the spot rate for the rand is $.20
• C) ​buying Singapore dollars from a bank (quoted at $.55) that has quoted the South African rand/Singapore dollar exchange rate at SAR3.00 when the spot rate for the rand is $.20
• D) ​converting funds to a foreign currency and investing the funds overseas

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Definitions:

Critical Point

A decisive moment or threshold in a process or system where significant change occurs, often leading to a new state or condition.

Stage Model

A theoretical model that describes a process through a series of stages or phases, often utilized in psychology, change management, and organizational theory.

Norming

A stage of group development where members establish norms, roles, and more harmonious relationships, enhancing the group's identity and cohesion.

Connie Gersick

A researcher known for her work on group dynamics, especially the concept of punctuated equilibrium in project teams.