Exchange rate risk; convertible currency; pegged exchange rate

Q: Explain the foreign currency swaps and why are they undertaken? Explain the functional currency and…

A: A foreign currency swap, also known as an FX swap, is an agreement between two foreign parties to…

Q: critically discuss main causes of exchange rate volatility in the foreign exchange markets. Please…

A: Exchange rate volatility- It refers to the tendency of a currency of one country  to appreciate or…

Q: the reporting of FX. What are the major differences in foreign currency accounting standards between…

A: Foreign currency Translation In the Foreign currency Translation the determination of functional…

Q: What can be understood from Foreign Exchange Rates?

A: Foreign exchange rate: A foreign exchange rate is the comparative value among two currencies. Merely…

Q: What are the differences in accounting for a forward contract used as a cash flow hedge of (a) a…

A: Cash flow hedge of a foreign currency denominated asset or liability: For a cash flow hedge of a…

Q: Give full definition of the market for foreign exchange.

A: The cross-border flow of money gives rise to foreign exchange. Foreign exchange refers to foreign…

Q: The factor used to convert from one country's currency to another country's currency  is called the:…

A: A) Interest rate - Interest rate is the rate at which return on an investment is to be earned or the…

Q: Under the fixed exchange rate system, what was the currency against whichall other currency values…

A: Answer: Foreign exchange rate is the currency exchange rate system in which a country’s central bank…

Q: country with fixed exchange rate rep plidation on Y, exchange rate E, i, C,

A: The figure is shown as,

Q: What is the subsequent measurement of foreign currency denominated nonmonetary items?

A: Non-monetary items denominated in foreign currencies that are measured at fair value are…

Q: Define spot rate (foreign exchange)

A: Spot rate (foreign exchange):  Spot rate is the present exchange rate at which a pair of currency…

Q: Question 4 There are two main functions of foreign exchange market; to convert the currency of one…

A: It the place where of one country is converted into currency of the other country.  It is a Over The…

Q: What factors create a foreign exchange gain on a foreign currency transaction? What factors create a…

A: Factors creating foreign exchange Gains or losses: 1) Having an exposure of receivables and payable.…

Q: Broadly defined, the foreign exchange (FX) market encompasses: O a. Foreign trade financing. Ob.…

A: The foreign exchange market is the place where various countries' currencies are purchased and sold…

Q: Spot rate; forward exchange rate; discount on foreign currency forward rate; premium on foreign…

A: According to the rule, we will only answer the first three subparts, for the remaining subparts,…

Q: Which of the following factors influences the spread between forward and spot rates? a. which…

A: Spot rate is the current rate of the stock or bond or currency and forward rate is the price that is…

Q: Transaction exposure:       A. measures the extent to which foreign exchange volatility may affect a…

A: Transaction exposure refers to the exposure level of loss happened from the risk involved in the…

Q: Describe how the prevailing interest rates in a country affect its exchange rates with the currency…

A: Prevailing interest rates in the country affects the purchasing power of an economy and capital…

Q: Foreign exchange risks   a. Occur when cash flows are affected by currency exchange rates   b.…

A: Foriegn exchange risks are risks that arise due to fluctuation in the exchange rate of the currency.…

Q: Define Foreign currency hedge.

A: Hedge: The process through which the risk associated with a particular project, can be eliminated is…

Q: These are currency quotes found on a foreign market: GH 4.30/$, and GH 4.55/$. ii. Which currency…

A: First quote 1$ = GH4.30 Second quote 1$ = GH 4.55 In first case if you have 1$ you can buy GH 4.30.…

Q: What is the effect of external transfers from expatriate employment on maintaining the stability of…

A: WHAT IS REMITTANCE? Remittance is an installment of cash that is moved to another gathering.…

Q: In which of the following relationships between the expected future spot rate (E(e)) of a foreign…

A: A speculator will sell foreign currency at present when it is expected that price will get lower in…

Q: What is that determines the relationship between spot abd forward foreign exchange rates?

A: The exchange rate between two currencies is the number of units of one currency per unit of the…

Q: An agreement to exchange currencies sometime in the future is referred to as which one of the…

A: An agreement where two parties decide to buy and sell a particular commodity in a predetermined…

Q: If the foreign operations reports in the currency of hyperinflationary economy, assets and…

A: Hyperinflation refers to the situation when there is a rapid and uncontrolled increase in the price…

Q: Define each of the following terms: d. Exchange rate risk; convertible currency; pegged exchange…

A: Introduction: The terms exchange rate, fixed exchange rate system, floating exchange rate are…

Q: Question: Which of the following: O d.A "forward foreign exchange contract" is an agreement to…

A: Since you have posted multiple questions, we will answer the first one for you. If you want a…

Q: Purchasing an option to buy foreign currency at a predetermined exchange rate in order to reduce…

A: Derivatives: Derivatives are some financial instruments which are meant for managing risk and…

Q: The bid-ask spread on an exchange rate implies _______. A. the transaction cost of foreign exchange…

A: Step 1 The spread of a bid-ask is the difference between the asking and bid prices in the market. A…

Q: Define each of the following terms: Multinational corporation Exchange rate; fixed exchange rate…

A: “Since you have posted a many questions, we will solve first question for you. To get the remaining…

Q: . Which one of the following is the agreed-upon exchange rate that is to be used when currencies are…

A: The forward exchange rate is the trade rate at which a person concurs to enter into a deal at a few…

Q: llustrate the different factors that determine future foreign exchange rates in the long run

A: The question is based on the concept of determination and determinants of foreign exchange rate  in…

Q: Explain the need for and problems associated with forecasting foreign  exchange rate

A: An exchange rate forecast indicates the expectation about future value of exchange rates at a future…