Realignment in the Exchange Rates of Banks Will Eliminate Locational

question 65

True/False

Realignment in the exchange rates of banks will eliminate locational arbitrage. More specifically, market forces will increase the ask rate of the bank from which the currency was bought to conduct locational arbitrage and will decrease the bid rate of the bank to which the currency was sold to conduct locational arbitrage.

---

Definitions:

Skills

The ability to do something well, often as a result of knowledge, practice, and aptitude.

Learning

The acquisition of knowledge or skills through experience, study, or by being taught, which leads to a change in behavior or understanding.

Bandura

Refers to Albert Bandura, a psychologist known for his work on social learning theory, emphasizing the role of observational learning, imitation, and modeling.

Engage

To participate or become involved in a particular activity or to enter into combat or conflict.