Final answer:
The rule with buying and selling currencies is based on the use of ask and bid prices, with buyers paying the ask price and sellers receiving the bid price.
Step-by-step explanation:
In the foreign exchange market, the buying and selling of currencies is done through the use of the ask and bid prices. The ask price is the price at which a seller is willing to sell a particular currency, while the bid price is the price at which a buyer is willing to buy that currency.
When buying a currency, you will pay the ask price, and when selling a currency, you will receive the bid price. The difference between the ask and bid prices is known as the spread, which represents the transaction costs associated with buying and selling currencies.
For example, if the ask price for USD/EUR (US Dollars to Euros) is 1.20 and the bid price is 1.19, it means that if you want to buy Euros, you will have to pay 1.20 US Dollars for each Euro. On the other hand, if you want to sell Euros, you will receive 1.19 US Dollars for each Euro.