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Unformatted text preview: Foreign Exchange Markets 1 Foreign Exchange Markets Summary International Business INB/205 Foreign Exchange Markets 2 Foreign Exchange Markets Summary Introduction The American nation has not had the experience of seeing money in the role of being a commodity. Americans have had the pleasure of enjoying a world in which the American dollar has been the main source of currency in stability and exchange in our current century. In Europe, citizens can travel to a neighboring country and the currency will be different from the currency they use, and their currency is not accepted in these countries. When Americans travel to a neighboring country, the merchants will accept their money. As this century nears an end, Americans may be surprised to find that their dollar may not be the main source of currency known to the world any longer, and could even become the currency undesirable to hold. Value of Currency Why and how currency will decrease or increase in value, the affects that these changes have on the world are matters that should be taken into consideration. Money is often seen as a method of exchange; however, money does have its own value, and money is considered a commodity just the same as any other commodity (Feiler & Schilling, n.d.). The value of currency when seen as a commodity will be determined through the result of an action by the government or by the international trade. This will then be observed and then a value is determined. This determination of the value of money is accomplished by using the foreign exchange markets. These markets will enable the international trade and businesses to either function or not function (Feiler & Schilling, n.d.). Trades in a foreign exchange are known to take place similar to an exchange like the board of trade in Chicago. However, the major backs that are located in a foreign nation will exchange the currency from one country to another....
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This note was uploaded on 04/19/2010 for the course N/A INB/205 taught by Professor N/a during the Summer '09 term at University of Phoenix.
- Summer '09