Triangular Arbitrage Eliminates Exchange Rate Differentials Across Three Markets for Three

question 39

True/False

Triangular arbitrage eliminates exchange rate differentials across three markets for three currencies.

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Definitions:

Range of Values

A set of values that includes the minimum and maximum values within a given dataset.

Cash Basis

An accounting method where revenues and expenses are recorded when they are actually received or paid out in cash.

IRR

The Internal Rate of Return is a financial measurement tool used to assess the profitability of prospective investments.

Accounting Basis

The method used to record financial transactions; common methods include cash basis and accrual basis accounting.