Question : Which of the following is an example of a direct quote for an exchange rate?
Option 1: USD/EUR = 0.85
Option 2: GBP/CAD = 1.65
Option 3: AUD/NZD = 1.10
Option 4: JPY/INR = 0.60
Answer (1)
20th Jan, 2024
Correct Answer:
USD/EUR = 0.85
Solution : The correct answer is (a) USD/EUR = 0.85.
A direct quote for an exchange rate is expressed as the domestic currency per unit of foreign currency. In this case, the direct quote USD/EUR = 0.85 means that 1 US dollar (USD) can be exchanged for 0.85 Euros (EUR).
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