Question

What is the term used in the foreign exchange market which denotes the currency in which the highest faith is shown and is needed by every economy?

• A. Hard Currency
• B. Hot Currency
• C. Soft Currency
• D. Cheap Currency

Hint:

Hard currency = global trust + stable economy → used in reserves, trade, and investment.

Answer 1

The Correct Option is A

A hard currency is stable, globally trusted, and widely used for international transactions.
It comes from a politically and economically stable country.
Examples: US Dollar, Euro, Japanese Yen.
In contrast:

“Hot currency” refers to capital quickly moving between countries.
“Soft currency” is unstable and not widely accepted.
“Cheap currency” is not a standard term.


Hence, (A) is the correct term.