International Finance And Treasury - Study Mode
[#521] Reasons for smaller exposure of foreign exchange than US money center are
Correct Answer
(D) all of above
Explanation
Solution: Reasons for smaller exposure of foreign exchange than US money center are regulations, prudent individuals and smaller size of assets.
[#522] In United States, JPMorgan Chase is considered as
Correct Answer
(A) largest foreign exchange trading
Explanation
Solution: In United States, JPMorgan Chase is considered as largest foreign exchange trading. The term ‘Forex’ stands for Foreign Exchange. Forex trading in simple terms is the trading in currencies from different countries against each other.
[#523] Theory which considers change in exchange rate with fluctuations in inflation rates is classified as
Correct Answer
(B) purchasing power parity
Explanation
Solution: Theory which considers change in exchange rate with fluctuations in inflation rates is classified as purchasing power parity. Purchasing power parity (PPP) is an economic theory that compares different countries' currencies through a "basket of goods" approach.
[#524] Inflation rate in United States is added into real rate of interest to calculate
Correct Answer
(C) interest rate in United States
Explanation
Solution: Inflation rate in United States is added into real rate of interest to calculate interest rate in United States. Inflation is a quantitative measure of the rate at which the average price level of a basket of selected goods and services in an economy increases over a period of time.
[#525] Position which came in to existence because of holding assets more than liabilities is considered as
Correct Answer
(A) net long in currency
Explanation
Solution: Position which came in to existence because of holding assets more than liabilities is considered as net long in currency. Net long refers to a condition in which an investor has a portfolio consisting of more long positions than short positions in a given asset, market, portfolio or trading strategy.