Base and Quote Currencies MCQs

1. In a currency pair, the first currency is called the:
A) Quote currency
B) Base currency
C) Secondary currency
D) Minor currency
Answer: B) Base currency

2. The second currency in a currency pair is known as the:
A) Primary currency
B) Base currency
C) Quote currency
D) Major currency
Answer: C) Quote currency

3. In the currency pair EUR/USD, which currency is the base currency?
A) USD
B) EUR
C) Both are base currencies
D) Neither is a base currency
Answer: B) EUR

4. If the currency pair USD/JPY is quoted as 110.00, this means:
A) 1 USD equals 110 Japanese Yen
B) 110 Japanese Yen equals 1 USD
C) Both currencies are equal
D) None of the above
Answer: A) 1 USD equals 110 Japanese Yen

5. What does it mean when the base currency appreciates?
A) It becomes weaker against the quote currency
B) It becomes stronger against the quote currency
C) The quote currency is more valuable
D) Both currencies are equally valued
Answer: B) It becomes stronger against the quote currency

6. In the currency pair GBP/AUD, which currency is the quote currency?
A) GBP
B) AUD
C) Both are quote currencies
D) Neither is a quote currency
Answer: B) AUD

7. When a trader buys a currency pair, they are:
A) Selling the base currency
B) Buying the quote currency
C) Buying the base currency
D) Selling both currencies
Answer: C) Buying the base currency

8. If the quote currency in a pair is stronger, what happens to the base currency?
A) It loses value
B) It gains value
C) It remains unchanged
D) It is irrelevant
Answer: A) It loses value

9. Which of the following pairs has the USD as the base currency?
A) EUR/USD
B) AUD/USD
C) GBP/JPY
D) CAD/CHF
Answer: B) AUD/USD

10. In trading, the value of the base currency is expressed in terms of the:
A) Primary currency
B) Quote currency
C) Counter currency
D) All of the above
Answer: B) Quote currency