OMR is quoted against USD and EURO. Under which of the following condition will the trader have a possibility of arbitrage? a. When the calculated cross rate of USD/EURO is different from Quoted cross rate  b. When calculated cross rate of OMR/EUR is different from Quoted cross rate  c. When calculated cross rate of OMR/USD is greater than quoted rate d. When calculated cross rate of USD/EUR is equal to Quoted cross rate

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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OMR is quoted against USD and EURO. Under which of the following condition will the trader have a possibility of arbitrage?

a.

When the calculated cross rate of USD/EURO is different from Quoted cross rate 

b.

When calculated cross rate of OMR/EUR is different from Quoted cross rate 

c.
When calculated cross rate of OMR/USD is greater than quoted rate
d.

When calculated cross rate of USD/EUR is equal to Quoted cross rate 

 

Which of the following is true about derivatives?
a.

Value of derivative is derived from predetermined asset 

b.

The terms and conditions are flexible under derivative trading

c.

Derivative markets are suitable for low risk investors

d.

Risk on derivatives market are always low

 

Which of the following condition may indicate that OMR has depreciated to EUR?
a.

Spot rate of EUR/OMR is equal to future rate of OMR/EUR 

b.

Spot rate of EUR/OMR is less than future rate of EUR/OMR

c.

None

d.

Future rate of EUR/OMR is equal to spot rate of OMR/EUR

e.

Future rate of OMR/EUR is less than Spot rate of OMR/EUR

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