Asked by Hallie Canto on Jul 08, 2024
Verified
There is no constant relationship between the spot and the forward exchange rate for a currency.
Spot Exchange Rate
The current price at which one currency can be exchanged for another currency in the foreign exchange market.
Forward Exchange Rate
The rate at which two currencies will be exchanged at a specified future date, agreed upon today.
- Identify the pivotal importance of spot and forward exchange rates in finance on a global scale.
Verified Answer
JW
Johnetta WaldonJul 12, 2024
Final Answer :
True
Explanation :
The spot and forward exchange rates for a currency are determined by different factors and can vary independently of each other. Therefore, there is no constant relationship between them.
Learning Objectives
- Identify the pivotal importance of spot and forward exchange rates in finance on a global scale.