Examlex
When a firm has risky debt, its debt can be viewed as an option on the total value of the firm with an exercise price equal to the face value of the equity.
Foreign Exchange
The global marketplace for buying and selling national currencies.
Purchasing Power Parity Theory
An economic theory that suggests that in the long term, exchange rates should adjust to equalize the price of identical goods and services in different countries.
Floating Exchange Rates
A system where the value of a currency is allowed to fluctuate according to the foreign exchange market without direct government control.
National Currencies
The official money used in different countries, which serves as a medium of exchange within each nation and can have different forms such as notes and coins.
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