ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -a foreign exchange dealer converts one currency into another currency on a particular day. Spot exchange rates are reported on a real-time basis on many financial websites. Spot rates change continually, often on a minute-by-minute basis (although the magnitude of changes over such short periods is usually small).

Detailed explanation-2: -A spot exchange rate is the current price at which a person could exchange one currency for another, for delivery on the earliest possible value date. Cash delivery for spot currency transactions is usually the standard settlement date of two business days after the transaction date (T+2).

Detailed explanation-3: -The spot exchange rate is the rate at which a foreign exchange dealer converts one currency into another currency on a particular day. A forward exchange occurs when two parties agree to exchange currency and execute the deal at some specific date in the future.

Detailed explanation-4: -The spot exchange rate is the current amount one currency will trade for another currency at a specific point in time. It is the open market price that a trader will pay to buy another currency.

Detailed explanation-5: -The forward exchange rate (also referred to as forward rate or forward price) is the exchange rate at which a bank agrees to exchange one currency for another at a future date when it enters into a forward contract with an investor.