I have doubt in Forex chapter.
Spot Rate : Rs./Euro= 83.80/30
In this situation which is right interpreation ?
1.Bid rate 83.80 and Ask rate 84.30
OR
2.Bid rate 83.30 and Ask rate 83.80
which one is correct one.
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Doubt regarding forex topic
Replies (33)
Bid rate 83.80 and Ask rate 84.30
Bid rate 83.80 and Ask rate 84.30
Agree with the above replies....the bid rate will always be less than ask because you sell currency at bid and buy it at ask from the dealer....the dealer is sitting to make profits which will happen only if he buys from you at a lower rate and sell to you at higher...
Your 2nd interpretation is correct. The bid rate should is 83.30 & ask rate is 83.80.. the bid rate is always less than the ask rate.
`bid rate 83.3 nd ask rate 83.8
if u want to comsider ask rate as 84.3 then the given rates should have been.. $=83.8/84.3 INR
@ Bhakti and Hemant : Your interpretation is wrong...... I am 110 percent sure option 1 is correct..... U can confirm from any book or your sfm teacher.....
@ Sourav - R u sure about this.
Yes first option is correct.... I have taken classes from CA Rajiv Singh so im sure..... U need not doubt on what your teacher taught u....
Bid rate shall be always less than Ask rate..
| Originally posted by : SACHIN | ||
 |
I THING ALL ABOVE ANSWERS ARE WRONG....BID 83.80 AND ASK 84.10 .....AND I M SURE ABOUT THIS..... |  |
Sachin you are wrong...... 0.30 never gets added,,,,,, Please recheck your answer.....
Suppose if 83.80/00 is given.... Then do you mean that bid is 83.80 and ask is also 83.80.... No it cannot be same..... It should be interpreted as bid as 83.80 and ask as 84.00 in this example of mine..... I hope you have understood.....
83.80-84.30 no doubt about that
| Originally posted by : Sourav | ||
|
@ Bhakti and Hemant : Your interpretation is wrong...... I am 110 percent sure option 1 is correct..... U can confirm from any book or your sfm teacher..... | |
@ sourav i cleared first grp of CA final with 67 in SFm in may 14...
It's Bid- 83.80 & Ask 84.30. Bid rate (i.e. Buying rate) can not be higher than Ask Rate (Selling rate) because it is not possible that one, say Bank, will buy a currency at a higher amount & sell the same at lower Rate.
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