Which of the Following Is Not a Method of Forecasting

question 30

Multiple Choice

Which of the following is not a method of forecasting exchange rate volatility?

• A) Using the absolute forecast error as a percentage of the realized value to improve your forecast.
• B) Using the volatility of historical exchange rate movements as a forecast for the future.
• C) Using a time series of volatility patterns in previous periods.
• D) Deriving the exchange rate's implied standard deviation from the currency option pricing model.

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Definitions:

Adjusting Entries

Entries recorded in the journals at the close of an accounting period to distribute income and expenditures to the period they actually took place.

Bank Reconciliation

Bank reconciliation is the process of matching the balances in an entity's accounting records for a cash account to the corresponding information on a bank statement.

NSF Check

A check that is not honored by a bank due to insufficient funds in the account of the person who wrote it; also known as a bounced check.

Bank Service Charge

Fees charged by banks for various services such as account maintenance, transactions, or overdrafts.