Multiple Choice
Assume that the yen/dollar exchange rate quoted in London at 3:00 p.m.is *120 = $1,and the New York yen/dollar exchange rate at the same time is *125 = $1.A dealer makes a profit by buying a currency low and selling it high.The dealer has engaged in a(n) :
A) currency swap.
B) arbitrage.
C) backwardation.
D) straddle.
Correct Answer:
Verified
Correct Answer:
Verified
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