What Keeps Foreign Exchange Quotes in Two Different Countries in Line

question 19

Multiple Choice

What keeps foreign exchange quotes in two different countries in line with each other?

• A) Cross rates
• B) Forward rates
• C) Arbitrage
• D) Spot rates

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Definitions:

Operating Expenses

Costs associated with running a business's core operations on a daily basis, excluding the cost of goods sold.

Current Assets

Assets that are cash or can be converted into cash within a year, including cash, accounts receivable, and inventory.

Amortized

The process of gradually writing off the initial cost of an asset over a period, or similarly, spreading loan payments over the loan term.

Amortization

Amortization is the process of gradually writing off the initial cost of an intangible asset over its useful life, reflecting its consumption or decline in value.