Question

What does not work in the foreign exchange market?

a) Transfer of purchasing power b) Credit supply c) Foreign exchange market d) Domestic clearing​

Answer 1

Answer:

Answer of the question is (C) Foreign exchange market

Answer 2

d) Domestic clearing does not work in the foreign exchange market.

⇒ The foreign exchange market is the marketplace to determine the foreign exchange rate of a currency. People can buy, sell, and exchange the exchange of different global currencies.

⇒ Domestic clearing involves domestic banks as a service to exchange information between banks to transfer funds to another bank.

• The important and major functions of a foreign exchange market are the options a) Transfer of purchasing power and b) Credit supply. Thus, they are a part of the foreign exchange market.
• However, option d) domestic clearing is nowhere related to a foreign exchange market hence, it will be our correct answer.

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