CFA Practice Question

There are 341 practice questions for this study session.

CFA Practice Question

Assume EUR:USD is 1.3146 and the three-month forward points are quoted as 28. The EUR:USD three-month forward rate is ______.

A. 1.5946
B. 1.3118
C. 1.3174
Correct Answer: C

1.3146 + 0.0028 = 1.3174

User Contributed Comments 3

User Comment
maryprz14 FX market is a stupid game!!! apparently, no rule applies to it; 28 means .0028. So let's say EUR:USd rate is 1.31460
the would 28 mean 0.00028?????
ahhhhhhhhhhhhhhh... I wanna shoot myself
timkalt If you have the 4-digit quotation, you can just add the BP´s to the end. So, in this case 3146+28=3174. Therefore, c is correct.
MathLoser 1.3146 . That's 4dp

28/(10)^4 = 0.0028

1.3146 + 0.0028 = 1.3174

What about 1.314? That's only 3. So 28/(10)^3 = 0.028
==> 1.314 + 0.028 = 1.342.

Go on.
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