A bank as dollar denominated account at b will fall

A. Bank A's dollar-denominated account at B will fall by $90,000.
B. Bank B's dollar-denominated account at A will rise by $90,000.
C. Bank A's pound-denominated account at B will rise by £45,000.
D. Bank B's pound-denominated account at A will fall by £45,000.
E. All of the above are correct
Topic: Correspondent Banking Relationships
12. The current exchange rate is £1.00 = $2.00. Compute the correct balances in Bank A's
correspondent account(s) with bank B if a currency trader employed at Bank A buys £45,000
from a currency trader at bank B for $90,000 using its correspondent relationship with Bank
Topic: Correspondent Banking Relationships
13. The current exchange rate is €1.00 = $1.50. Compute the correct balances in Bank A's
correspondent account(s) with bank B if a currency trader employed at Bank A buys €100,000
from a currency trader at bank B for $150,000 using its correspondent relationship with Bank
Topic: Correspondent Banking Relationships
5-2

Chapter 05 - The Market for Foreign Exchange
14. The spot market
Topic: The Spot Market
15. Spot foreign exchange trading
A. accounts for about 5 percent of all foreign exchange trading.
B. accounts for about 20 percent of all foreign exchange trading.
C. accounts for about 33 percent of all foreign exchange trading.
D. accounts for about 70 percent of all foreign exchange trading.
Topic: The Spot Market
Spot Rate Quotations
16. Using the table shown, what is the most current spot exchange rate shown for British
pounds? Use a direct quote from a U.S. perspective.
Topic: The Spot Market
17. Suppose that the current exchange rate is €0.80 = $1.00. The direct quote, from the U.S.
perspective is
Topic: The Spot Market