Question

What is a Swap Transaction in the context of the Foreign Exchange Market?

a.

A simultaneous exchange of currencies at a fixed rate

b.

A temporary transaction with a condition to reverse in the future

c.

An immediate exchange of currencies, goods, and services

d.

A fixed-rate transaction with a deferred settlement date

Posted under IC 89 Management Accounting

Answer: (b).A temporary transaction with a condition to reverse in the future Explanation:A Swap Transaction involves a temporary transaction on spot with a condition to move back in the opposite direction in the future.

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Q. What is a Swap Transaction in the context of the Foreign Exchange Market?
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