Tutorial 4 Flashcards by John MacRae

Q

Bid rate

A

The rate a bank is willing to buy a currency at

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Q

Ask rate

A

The rate a bank is willing to sell a currency at

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Q

CHF1.3990–1.4000/USD

A

Bid rate of CHF1.3990/$( bank will give you 1.3990CHF per dollar
Ask rate of 1.4000/$ (bank will give you 1$ per 1.4CHF)

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Q

Expected exchange rate (x)

A

(X - spot rate) / spot rate = rate of depression/inflation

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