Forex Trading Quiz Mock Test: Paper 1 - Making India Self Dependent

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Forex Trading Quiz Mock Test (paper 1)

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Total number of questions: 30
Time allotted: 20 minutes
Pass Score: 35%
Certificate: Yes
Random questions: No
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1. Which type of currency pairs is known for its potential for significant price movements but carries higher risk due to lower liquidity?

A) Major Currency Pairs

B) Minor Currency Pairs

C) Exotic Currency Pairs

D) Synthetic Currency Pairs

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2. What is the primary advantage of trading major currency pairs for Forex traders?

A) Higher leverage opportunities.

B) Lower spreads and transaction costs.

C) Greater potential for price volatility.

D) Availability of exotic currency pairs.

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3. Which category of currency pairs typically has the tightest spreads and highest liquidity?

A) Major Currency Pairs

B) Minor Currency Pairs

C) Exotic Currency Pairs

D) Synthetic Currency Pairs

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4. Which currency pair involves the Japanese yen (JPY) as the quote currency?

A) EUR/USD

B) USD/JPY

C) GBP/USD

D) AUD/USD

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5. In Forex trading, what does the term "synthetic currency pairs" refer to?

A) Pairs created using advanced trading algorithms.

B) Currency pairs that don't involve major currencies.

C) Pairs formed by combining two exotic currencies.

D) Non-existent currency pairs used for testing purposes.

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6. Which type of currency pairs includes combinations of major currencies, such as EUR/GBP or EUR/AUD?

A) Major Currency Pairs

B) Minor Currency Pairs

C) Exotic Currency Pairs

D) Synthetic Currency Pairs

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7. If you trade the EUR/TRY currency pair, which category does it belong to?

A) Major Currency Pairs

B) Minor Currency Pairs

C) Exotic Currency Pairs

D) Synthetic Currency Pairs

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8. Which type of currency pairs involves currencies from emerging or smaller economies and is characterized by lower liquidity and higher spreads?

A) Major Currency Pairs

B) Minor Currency Pairs

C) Exotic Currency Pairs

D) Synthetic Currency Pairs

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9. In Forex trading, what are "Minor" currency pairs also known as?

A) Base currency pairs

B) Cross currency pairs

C) Exotic currency pairs

D) Synthetic currency pairs

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10. Which category of currency pairs includes the most frequently traded and widely recognized pairs in the Forex market?

A) Major Currency Pairs

B) Minor Currency Pairs

C) Exotic Currency Pairs

D) Synthetic Currency Pairs

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11. What is a "cross currency pair" in Forex?

A) A currency pair that involves the US Dollar (USD).

B) A currency pair that doesn't involve the US Dollar (USD).

C) A currency pair with a fixed exchange rate.

D) A currency pair with a floating exchange rate.

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12. What is a "currency combination" in Forex trading?

A) The mixing of different types of currency.

B) A type of trading strategy.

C) A term used to describe exotic currency pairs.

D) The combination of two currencies to form a currency pair.

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13. How is the exchange rate for a currency pair determined in the Forex market?

A) By individual traders' opinions.

B) By government authorities.

C) By central banks only.

D) By supply and demand forces in the market.

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14. What is the term for the smallest price movement in Forex, typically the last decimal place in an exchange rate?

A) Margin

B) Leverage

C) Pip

D) Lot

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15. What does the spread represent in Forex trading?

A) The difference between the bid and ask prices.

B) The difference between the opening and closing prices.

C) The total value of a trading account.

D) The profit or loss in a trade.

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16. What is a currency pair's "ask" price?

A) The price at which you can sell the base currency.

B) The price at which you can buy the base currency.

C) The price at which you can buy the quote currency.

D) The price at which you can sell the quote currency.

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17. What is a currency pair's "bid" price?

A) The price at which you can sell the base currency.

B) The price at which you can buy the base currency.

C) The price at which you can buy the quote currency.

D) The price at which you can sell the quote currency.

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18. If the EUR/USD exchange rate is 1.1500, what does this mean?

A) 1 Euro can be exchanged for 1500 US Dollars.

B) 1500 Euros can be exchanged for 1 US Dollar.

C) 1 US Dollar can be exchanged for 1500 Euros.

D) 1500 US Dollars can be exchanged for 1 Euro.

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19. What does the exchange rate of a currency pair represent?

A) The total value of both currencies in the pair.

B) The price of the base currency in terms of the quote currency.

C) The price of gold in the respective countries.

D) The average value of the currency pair over a year.

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20. In a currency pair like EUR/USD, which currency is the base currency?

A) EUR (Euro)

B) USD (US Dollar)

C) Both are base currencies.

D) Neither is the base currency.

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21. Which major trading session is often referred to as the "powerhouse" session due to its significant trading volume?

A) Tokyo Session

B) London Session

C) New York Session

D) Sydney Session

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22. When do Forex market sessions overlap, creating increased trading activity and higher liquidity?

A) During weekends.

B) During national holidays.

C) During daylight saving time changes.

D) During the overlap of two major trading sessions.

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23. What is the primary currency traded during the Sydney trading session?

A) Euro (EUR)

B) Japanese Yen (JPY)

C) Australian Dollar (AUD)

D) Swiss Franc (CHF)

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24. During which major Forex trading session does the Sydney market operate?

A) Tokyo Session

B) London Session

C) New York Session

D) Sydney Session

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25. What is the primary currency traded during the New York trading session?

A) Euro (EUR)

B) Japanese Yen (JPY)

C) US Dollar (USD)

D) Canadian Dollar (CAD)

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26. During which major Forex trading session does the New York market operate?

A) Tokyo Session

B) London Session

C) New York Session

D) Sydney Session

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27. What is the primary currency traded during the London trading session?

A) Euro (EUR)

B) Japanese Yen (JPY)

C) British Pound (GBP)

D) Australian Dollar (AUD)

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28. During which major Forex trading session does the London market operate?

A) Tokyo Session

B) New York Session

C) London Session

D) Sydney Session

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29. What is the primary currency traded during the Tokyo trading session?

A) Euro (EUR)

B) Japanese Yen (JPY)

C) British Pound (GBP)

D) Swiss Franc (CHF)

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30. During which major Forex trading session does the Tokyo market operate?

A) London Session

B) New York Session

C) Tokyo Session

D) Sydney Session

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