Thẻ ghi nhớ: UNIT 5 FOREIGN EXCHANGE | Quizlet

Convertible currency/Hard currency

Currency that trades freely in the foreign exchange market, with its price determined by the forces of supply and demand is called a _______

Gold standard

An international monetary system in which nations linked the value of their paper currencies to specific values of gold was called the ________

Currency futures contract

A _______ is a contract requiring exchange of a specific amount of currency on a specific date at a specific exchange rate with all of the conditions fixed and not adjustable.

Forward rate

The exchange rate at which 2 parties agree to exchange currencies on a specified future date is called the _______

Forward contract

______ is a contract requiring the exchange of a agreed-upon amount of a currency on an agreed-upon date at a specific exchange rate

Currency swap

A ________ is the simultaneous purchase and sale of foreign exchange for 2 different dates

Fixed exchange rate system

A system in which the exchange rate for converting one currency into another is fixed by international agreement is called a ________

Bretton Woods Agreement

The ______ was an accord among nations to create a new international monetary system based on the value of the U.S. dollar

World Bank

The agency created by the Bretton Woods Agreement to provide funding for national economic development efforts is called the ________

The IMF

________ was the agency created by the Bretton Woods Agreement to regulate fixed exchange rates and enforce the rules of the international monetary system

Managed float system

An exchange rate system in which currencies float against one another with governments intervening to stabilize currencies at a particular target exchange rate is known as a ______

Free float system

_______ is an exchange rate system in which currencies float freely against one another, without governments intervening in currency market

Buy rate

The exchange rate at which the bank will buy a currency is called a ______

Ask rate

______ is the exchange rate at which the bank will sell a currency

Currency option

A ______ is a right, or option, to exchange a specific amount of a currency on a specific date at a specific rate

derivatives

_______ is a general name for all financial instruments whose price depends on the movement of another price

commodities

_______ is raw materials or primary products (metals, cereals, coffee, etc.) that are traded on special market

Foreign exchange market

The market in which currencies are bought and sold and in which currency prices are determined is called _______.

Currency hedging

The practice of insuring against potential losses that result from adverse changes in exchange rates is called _______

Currency arbitrage

______ is the instantaneous purchase and sale of a currency in different markets for profit

Currency speculation

_______ is the purchase or sale of a currency with the expectation that its value will change and generate a profit

Quoted currency

In a quoted exchange rate, the currency with which another currency is to be purchased is called the ______

Base currency

In a quoted exchange rate, the currency that is to be purchased with another currency is called the _______

Spot rate

The exchange rate requiring delivery of the traded currency within 2 business days is called the ______