A continuum random phase approximation (RPA) method for evaluating the structure function of nuclear matter is developed, where exchange terms for any particle-hole interaction are explicitly included. The method is applied to the inclusive transverse quasielastic electron scattering response at momentum transfer ranging from q=300 to 550 MeV/c. The interaction employed is a g ′ Landau-Migdal constant plus a (π+ρ)-meson exchange interaction. A comparison with the standard ring series is made showing that the inclusion of finite range effects in the exchange terms is necessary. © 1996 The American Physical Society.