If today's exchange rate in the New York market is 74 U.S. cents per Canadian dollar and 75 U.S. cents per Canadian dollar in the Toronto market, what transactions will traders take?

Question

Accepted Answer

Traders will sell Canadian dollars in Toronto and buy them in New York and make a profit.

Answer

Traders will be indifferent between trading in these two markets.

Answer

U.S. traders prefer to use the New York market whereas Canadian traders prefer to use the Toronto market.

Answer

Traders will sell Canadian dollars in Toronto and buy them in New York and the exchange rate in New York falls.

Answer

Traders will buy Canadian dollars in Toronto and sell them in New York and make a profit.

Crowdly

If today's exchange rate in the New York market is 74 U.S. cents per Canadian do...

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