Explain how triangular arbitrage works. Why is this important for vehicle currencies in global markets?

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International Economics

ISBN: 9781319218508

5th Edition

Authors: Robert C. Feenstra, Alan M. Taylor

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Question Posted: Jan 03, 2023 05:32 AM

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Explain how triangular arbitrage ensures that currency values are essentially the same in different markets around the world at any given moment.
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Explain how triangular arbitrage works. Why is this important for vehicle currencies in global markets?

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A triangular trade occurs in the following way First the arbitrager buys one currency A Then s...View the full answer

International Economics

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