Question

Currency traders can use leverage to do which of the following?
A. Entice unwilling currency holders to sell below market price.
B. Influence the exchange rate with small currency purchases.
O O O O
C. Buy large amounts of a currency with little money up front.
D. Force foreign governments to give them discounted exchanges.

Answer 1

Answer:

Option C, buy large amounts of a currency with little money up front, is the right answer.

Explanation:

The term Leverage is referred to as the borrowing of a certain amount for the purpose of investing in something. In Forex, the money is generally borrowed from a broker.

High leverage is provided by Forex trading in the way that for an initial margin requirement. This also applies that the leverage of margin is equivalent to maximum real leverage.