CFA Practice Question

There are 253 practice questions for this study session.

CFA Practice Question

Given the spot rate quotes in the interbank market (BRL is Brazilian Real, and ARS is Argentine Peso):

BRL/USD: 2.0307 - 2.0348, ARS/USD: 4.2838 - 4.2880.

What is the implied bid-ask ARS/BRL cross rate?
A. 2.1073 - 2.1095.
B. 2.1053 - 2.1116.
C. 2.1053 - 2.1095.
Explanation: ARS/BRL = ARS/USD x (BRL/USD)-1. We need to invert the BRL/USD quotes and interchange bid and offer, we get:

Bid: 4.2838/2.0348 = 2.1053.
Ask: 4.2880/2.0307 = 2.1116.

User Contributed Comments 1

User Comment
janis36 Always choose the most expensive option.
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