ECONOMICS
FOREIGN CURRENCY MARKETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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they want to save money.
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they hope to make a profit.
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they need foreign currency for travel.
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None of the above
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Detailed explanation-1: -Currencies are akin to commodities and stocks because they offer the potential for capital appreciation. If the value of your currencies rises against the dollar, you will profit. If your currencies fall relative to the dollar, you will lose money.
Detailed explanation-2: -5.3. The foreign exchange market or forex market is the market where currencies are traded. The forex market is the world’s largest financial market where trillions are traded daily. It is the most liquid among all the markets in the financial world.
Detailed explanation-3: -Demand for foreign exchange arises when people want to speculate on the value of foreign currency. Speculators demand foreign currency in the present period with the aim of selling it in future at higher prices.
Detailed explanation-4: -What is buying and selling in forex? Buying and selling in forex is speculating on the upward and downward price movements of a currency pair, with the hopes of making a profit. All forex trading involves buying one currency and selling another, which is why it is quoted in pairs.