When we are looking at the supply and demand for NZD in the foreign exchange market, why do we label the price axis as "USD/NZD"?
Question
Solution 1
In the foreign exchange market, currencies are quoted in pairs. The first currency listed is the base currency and the second is the quote currency. The price axis is labeled "USD/NZD" because it represents how many New Zealand dollars (NZD) you would need to buy one US dollar (USD).
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