Attempts Average 4 2. Foreign exchange transactions 1 2 3. STEP: 2013 Suppose that this month the exchange rate has decreased to $1.05 and that it is time for Nevada Co to makes its monthly purchase of materials from Spicurity In order to conduct this transaction this month, Nevada Co now requires s transaction must reduce Nevada's account by this amount, denominated in and credit it to Spicurity's account to pay for the materials. Thus, the bank handling the . The bank must then convert this amount to euros True or False: The bank has not acted as a foreign exchange dealer in this dollars True False Grade 5 OTAL SCORE: 0.75/4 mchen OX 1. 3. STEP of Suppose that Nevada Co, a US-based MNC, makes regular monthly purchases of materials from German med SportThere payments are typically in the amount of 370.000 euros. Last month the exchange rate was $1.15 pereurs de las cash reserve in dollars, while Spicurity only has cash reserves in euros. Suppose both companies use the same bank E In order to conduct this transaction last month, Nevada co required $28.000.00 X to pay for the material. Thus, the handing the transaction reduced Nevada's account by this amount, denominated in dollars. The bank then converted this amount to 370,000.00 euros and credited it to Spicurity's account 0.75/1 Explanation: Close Explanation In order to purchase the monthly materials, Nevada needs to pay 370.000 euros to Spicurity. However, since Nevada only has cash reserves in dollars, it will need to convert dollars euros (via their bank) in order to make this purchase. Thus, Nevada must trust their bank trace their account by 370.000 euros x SH15 per euro 5425.500, and exchange those dollars for 370.000 euros. The banks must the credit those 370.000 euros to Spicurity's account