Which of the Following Statements Is True

question 52

Multiple Choice

Which of the following statements is true?

• A)In case an FI purchases or sells foreign currencies to allow customers to partake in and complete international commercial trade transactions, the FI acts as an agent of its customers for a fee and does assume part of the FX risk.
• B)In case an FI purchases or sells foreign currencies to allow customers to partake in and complete international commercial trade transactions, the FI acts as an agent of its customers for a fee but does not assume any of the FX risk.
• C)In case an FI purchases or sells foreign currencies to allow customers to partake in and complete international commercial trade transactions, the FI acts as a hedger to reduce the FX exposure.
• D)In case an FI purchases or sells foreign currencies to allow customers to partake in and complete international commercial trade transactions, the FI acts as an agent of its customers for a fee and as a hedger to reduce the FX exposures.

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Definitions:

Dual Federalism

A political theory wherein state and national governments are seen as distinct entities providing separate services, limiting the power of the national government.

Founding

The act of establishing or creating something, such as a nation, organization, or institution.

Civil War

A conflict between different factions or regions within the same country, often characterized by intense military engagements.

New Deal

A series of programs, public work projects, financial reforms, and regulations enacted by President FDR in the United States during the 1930s to help recover from the Great Depression.