Q Describe how organizations interact in the foreign exchange market. Include the advantages and disadvantages of conducting global business using the foreign exchange market. Use examples to help support your discussion.
The organizations can interact in the foreign exchange market through financial institutions and can operate on different levels. Banks can turn to a smaller number of financial organizations that are known as dealers, who are engaged in the large quantities of the foreign exchange trading in a proper manner. The organizations have to be aware of the components of the foreign exchange market and those are the trade rate, currencies, amounts, counterparty, value date and exchange rate (Chaboud, Chiquoine, Hjalmarsson, & Vega, 2014).
