True or False?
The correct answer is False. The forward exchange rate is the rate of exchange, agreed upon today, at which the contracting parties commit themselves to exchange marks and francs in 90 days. The exchange of currencies occurs in 90 days, but the price at which the exchange will take place is agreed-upon now. The spot exchange rate is the rate at which two currencies can be exchanged on the spot in the absence of any forward commitments. If one wants to buy francs with marks in 90 days and has not entered into a forward contract to do so, one will have to pay the spot exchange rate ruling at that time.
To make the question in statement true, we would have to reword it in a way that will make clear that the forward rate is an exchange rate agreed upon now for a transaction that will occur in 90 days.