A Trader in Switzerland Just Agreed to Trade Swiss Francs

question 65

Multiple Choice

A trader in Switzerland just agreed to trade Swiss francs for British pounds based on today's exchange rate.The trade is expected to settle tomorrow.What term best describes this exchange?

• A)Arbitrage transaction
• B)Forward trade
• C)Spot trade
• D)Purchasing power parity
• E)Interest rate parity

---

Definitions:

UCC

Uniform Commercial Code, a set of laws that provide legal rules and regulations governing commercial or business dealings and transactions in the United States.

Shipment Contract

A contract where the seller is required to send the goods to the buyer, but the title to the goods passes when the seller fulfills their obligation to ship.

Carrier

An entity that provides transportation services for goods or individuals.

Destination

The destination where a person or an item is headed or directed.