1. A decrease in the USD/EUR exchange rate from 1.44 to 1.42 represents a (n):

A. appreciation of EUR relative to USD of 1.39%.
B. depreciation of EUR relative to USD of 1.39%.
C. depreciation of USD relative to EUR of 1.39%.


2. If the domestic currency depreciates, the direct exchange rate quote will most likely:

A. increase.
B. decrease.
C. remain the same.


3. A dealer quotes a CAD/USD spot rate to be 1.1468. Given that the 6-month forward rate is 1.1527, the 6-month forward points are most likely to be:

A. -59.
B. +51.
C. +59.

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