A. attempt to profit by trading on expectations about future currency prices
B. bear risk as they attempt to ____ beat the market||
C. attempt to buy currency at a low price and later resell that currency at a higher price
D. Simultaneously buy a currency at a low price and sell that currency at a higher price, making a riskless profit
Related Mcqs:
- Currency speculation is _____ if speculators bet against market forces that cause exchange fluctuations, thus moderating such fluctuations ?
A. destabilizing
B. stabilizing
C. inflationary
D. deflationary - In the absence of international capital controls, central banks set ________ to provide the correct incentive for speculators?
A. money supply targets
B. income policy
C. interest rates
D. inflation targets - Which exchange rate system involves a leaning against the wind|| strategy in which short-term fluctuations in exchange rates are reduced without adhering to any particular exchange rate over the long run ?
A. pegged of fixed exchange rates
B. adjustable pegged exchange rates
C. managed floating exchange rates
D. free floating exchange rates - Many U.S firms have sought relief from foreign competition by demanding protectionism policies by the U.S government. A better way for companies to compete is to expand into foreign markets and ?
A. lower prices
B. increase promotion both at home and abroad
C. continuously improve their products at home
D. join into cartels at home - Goals are achieved through ____ such a monetary fiscal, exchange rate tariff tax subsidy, business incentive foreign investment and foreign aid?
A. indicative plan
B. central bank policies
C. central planning
D. instrument variables - What is called that bank which regularly accepts foreign currency-denominated deposits and makes foreign currency-denominated deposits and makes foreign currency loans ?
A. Eurobank
B. Foreign bank
C. International Bank
D. Multinational Bank - If a government uses barriers to foreign products such as biases against a foreign company’s bids or product standards that go against a foreign company’s product features the government is using ?
A. Protectionism
B. exchange controls
C. exchange facilitators
D. nontariff trade barriers - The exchange rate is kept the same across geographically separate markets by ?
A. hedging
B. speculation
C. government regulation
D. arbitrage - Which of the following is not a reason why Joe Smith (an American) might participate as a demander in the foreign exchange market ?
A. his desire to open a bank account in Japan
B. his desire to purchase an automobile produced domestically
C. his desire to travel to Europe
D. his desire to purchase Treasury bills issued by the British government - The theory of international exchange that holds that exchange rates adjust to offset differences in countries inflation rates in the ?
A. price feedback theory
B. trade feedback theory
C. J-curve theory
D. purchasing power parity theory
