14-50 Which of the Following FX Trading Activities Is Used

question 56

Multiple Choice

14-50 Which of the following FX trading activities is used to hedge FX risk?

• A)The purchase and sale of foreign currencies for the purpose of profiting from forecasting or anticipating future movements in FX rates.
• B)The purchase and sale of foreign currencies to allow customers to partake in and complete international commercial trade transactions.
• C)The purchase and sale of foreign currencies for the purpose of offsetting customer exposure in any given currency.
• D)The purchase and sale of foreign currencies to allow customers to take positions in foreign real and financial investments.
• E)None of the above.

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Definitions:

Blocking

A technique in experimental design used to remove the effects of confounding variables by grouping subjects that are similar in some way.

Five-point Scale

A scale commonly used in surveys and questionnaires that offers five possible responses to a question, often ranging from "Strongly Agree" to "Strongly Disagree".

Bottled Water

Water that is packaged in plastic or glass bottles, often purified or sourced from springs or artesian wells.

Blocking

A method in experimental design to reduce variance by grouping experimental units with similar characteristics together and then randomly assigning treatments within these groups.