50+ Foreign Exchange Market MCQ’s | (Free Resource) Business Economics

31. The foreign exchange rate of a nation is influenced by ________ .
a) all of the below
b) speculators
c) hedgers
d) arbitrators

32. The foreign exchange rate of a nation is influenced by _________ .
a) all of the below
b) BoP
c) Interest rate
d) speculation

33. _______ is not a feature of spot exchange rate.
a) Clearing of payment takes place fairly long period
b) demand and supply of foreign currency determines the rate
c) current exchange rate
d) all of the above

34. The demand for foreign currency arises due to _______ .
a) imports
b) exports
c) investments from abroad
d) none of the above

35. The supply of foreign currency is on account of _______ .
a) exports
b) imports
c) investments abroad

36. _______ rate is the rate at which a nation’s currency is exchanged for some other nation’s currency.
a) Exchange
b) Transfer
c) Negotiating
d) All of the above

37. The demand curve for foreign exchange slopes ________ indicating that when the exchange rate of foreign currency falls, the demand for it increases.
a) downwards
b) upwards
c) sideways
d) none of the above

38. The supply curve for foreign currency slopes _________ indicating that when the exchange rate of foreign currency increases, the supply of it increases.
a) upwards
b) downwards
c) sideways
d) all of the above

39. If there is more demand for foreign currency, the foreign currency will _______ .
a) appreciate
b) depreciate
c) nil effect
d) none of the above

40. When the demand curve for foreign currency, intersects the supply curve, we get _________ exchange rate.
a) equilibrium
b) premium
c) discount
d) par

Answers: 31)all of the below 32)all of the below 33)Clearing of payment takes place fairly long period 34)imports 35)exports 36)Exchange 37)downwards 38)upwards 39)appreciate 40)equilibrium