QUESTION 1

On January 1, 2021, Euro and USD exchange rate was 1.23 USD/EUR. Today, the Euro exchange rate is 0.83 EUR/USD. Can you tell if EUR has appreciated or depreciated relative to USD from January 1 to today? How much is the change in Euro currency value relative to USD?

	A.	Euro has depreciated 32% relative to USD.
	B.	Euro has appreciated 2% relative to USD.
	C.	Euro has appreciated 32% relative to USD.
	D.	Euro has depreciated 2% relative to USD.

QUESTION 2

Given the following exchange rates in the market, what should be the exchange rate between Canadian dollar and Euro?

Canadian dollar: 0.80 USD/CAD

Euro: 1.13 USD/EUR

	A.	0.9040 EUR/CAD
	B.	0.7080 CAD/EUR
	C.	1.4125 EUR/CAD
	D.	0.7080 EUR/CAD

QUESTION 3

Calculate the relative bid-ask spread for the following exchange rates. How much money you will lose if you convert 100,000 US dollar into the Canadian dollar and then convert the Canadian dollar back to the US dollar based on the quotes below?

	Bid Price (USD/CAD)	Ask Price (USD/CAD)
Canadian dollar	0.7500	0.7520

	A.	Relative bid-ask spread: 0.266%; Loss: $200 USD
	B.	Relative bid-ask spread: 0.200%; Loss: $200 USD
	C.	None is correct.
	D.	Relative bid-ask spread: 0.266%; Lose: $266 USD