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Foreign exchange market and determination of foreign exchange rate In 2016, the nominal exchange rate between the pound sterling () and the euro (e) is

Foreign exchange market and determination of foreign exchange rate

In 2016, the nominal exchange rate between the pound sterling () and the euro (e) is 1.00 = e1.20

a. How many euros do you receive for 1?

b. How many pounds will you receive for e1?

c. What is the difference between a forward exchange rate and a spot exchange rate?

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