For a US Trader Working in American Quotes, If the Forward Price

question 40

Multiple Choice

For a U.S. trader working in American quotes, if the forward price is higher than the spot price

• A)the currency is trading at a premium in the forward market.
• B)the currency is trading at a discount in the forward market.
• C)then you should buy at the spot, hold on to it and sell at the forward-it's a built-in arbitrage.
• D)all of the above-it really depends if you're talking American or European quotes.

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