What Is a Foreign Currency Transaction

question 34

Multiple Choice

What is a foreign currency transaction?

• A) It is another name for an international transaction.
• B) It is a transaction that involves payment at a date sometime in the future.
• C) It is a business deal denominated in a currency other than a company's domestic currency.
• D) It is an economic event measured in a currency other than U.S. dollars.

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Definitions:

Amortization Period

The total time period over which a loan or mortgage is scheduled to be paid off through regular payments.

Compounded Semi-annually

A method of calculating interest where the earned interest is added to the principal every six months, allowing interest to be earned on the previously earned interest.

Lump Payment

A single, large payment made at once, instead of breaking it into smaller installments.

Amortization Period

The length of time over which the principal amount of a loan, mortgage, or other debt is scheduled to be paid off.