Question 1

The market value of a share is responsible for.

Accepted Answer

A)  The investment market
B)  The government
C)  Shareholders
D)  The respective companiesE) A) and D)
F) All of the above

Question 2

Hedging is used by companies to:

Accepted Answer

A)  Decrease the variability of tax paid
B)  Decrease the spread between spot and forward market quotes
C)  Increase the variability of expected cash flows
D)  Decrease the variability of expected cash flowsE) None of the above
F) B) and C)

Question 3

Govt. policy about exports and imports is called:

Accepted Answer

A)  Commercial policy
B)  Fiscal policy
C)  Monetary policy
D)  Finance policyE) All of the above
F) A) and B)

Question 4

What is the Bill receivable account?

Accepted Answer

A)  Personal Account
B)  Machinery Account
C)  Real Account
D)  Nominal AccountE) None of the above
F) A) and B)

Question 5

If purchasing power parity were to hold even in the short run, then:

Accepted Answer

A)  real exchange rates should tend to decrease over time.
B)  quoted nominal exchange rates should be stable over time.
C)  real exchange rates should tend to increase over time.
D)  real exchange rates should be stable over time.E) B) and C)
F) A) and D) D

Question 6

The finance manager is accountable for.

Accepted Answer

A)  Earning capital assets of the company
B)  Effective management of a fund
C)  Arrangement of financial resources
D)  Proper utilisation of fundsE) B) and D)
F) B) and C)

Question 7

The forward market is especially well-suited to offer hedging protection against

Accepted Answer

A)  translation risk exposure.
B)  transactions risk exposure.
C)  political risk exposure.
D)  taxation.E) B) and C)
F) A) and B)

Question 8

Which bill is drawn and accepted in the same country?

Accepted Answer

A)  Trade Bill
B)  Foreign Bill
C)  Inland Bill
D)  Accommodation BillE) A) and C)
F) A) and B)

Question 9

Which among the following is not concerned with Chambers of Commerce & Industry

Accepted Answer

A)  CII
B)  FICCI
C)  ICICI
D)  ASSOCHAME) C) and D)
F) B) and D)

Question 10

Interest Rate Parity (IRP)  implies that:

Accepted Answer

A)  Interest rates should change by an equal amount but in the opposite direction to the difference in inflation rates between two countries
B)  The difference in interest rates in different currencies for securities of similar risk and maturity should be consistent with the forward rate discount or premium for the foreign currency
C)  The interest rates between two countries start in equilibrium, any change in the differential rate of inflation between the two countries tends to be offset over the longterm by an equal but opposite change in the spot exchange rate
D)  In the long run real interest rate between two countries will be equalE) None of the above
F) B) and D) B

Question 11

International trade and domestic trade differ because of:

Accepted Answer

A)  Different government policies
B)  Immobility of factors
C)  Trade restrictions
D)  All of the aboveE) B) and C)
F) None of the above

Question 12

What are the three additional days known as that a drawer gives to the drawee for payment

Accepted Answer

A)  Conditional days
B)  Additional days
C)  Days of grace
D)  Days of rebateE) None of the above
F) B) and C)

Question 13

What does financial leverage measure?

Accepted Answer

A)  No change with EBIT and EPS
B)  The sensibility of EBIT with % change with respect to output
C)  The sensibility of EPS with % change in the EBIT level
D)  % variation in the level of productionE) A) and B)
F) B) and C)

Question 14

From the below-mentioned items which are financial assets?

Accepted Answer

A)  Machines
B)  Bonds
C)  Stocks
D)  B and CE) A) and C)
F) A) and B) C

Question 15

One example of Small scale Fixed retailers among these is

Accepted Answer

A)  Pedlars
B)  General stores
C)  Hawkers
D)  Cheap JacksE) All of the above
F) A) and D)

Question 16

Agents are appointed by?

Accepted Answer

A)  Manufacturer
B)  Wholesaler
C)  Retailer
D)  PrincipalE) A) and C)
F) B) and D)

Question 17

Investment can be defined.

Accepted Answer

A)  Person's dedication to purchasing a house or flat
B)  Use of capital on assets to receive returns
C)  Usage of money on a production process of products and services
D)  Net additions made to the nation's capital stocksE) C) and D)
F) A) and C)

Question 18

The term Euro Currency market refers to

Accepted Answer

A)  The international foreign exchange market
B)  The market where the borrowing and lending of currencies take place outside the country of issue
C)  The countries which have adopted Euro as their currency
D)  The market in which Euro is exchanged for other currenciesE) A) and B)
F) A) and C)

Question 19

Who among the following appoints the agent

Accepted Answer

A)  Principal
B)  Retailer
C)  Manufacturer
D)  WholesalerE) None of the above
F) All of the above

Question 20

Goods imported for the purpose of export is known as

Accepted Answer

A)  Home trade
B)  Foreign trade
C)  Entrepot
D)  TradeE) A) and B)
F) B) and C)

Exam 5: International Finance: International Investment, Exchange Rates, and Financial Markets

The market value of a share is responsible for.

Correct AnswerverifiedShow Answer

Hedging is used by companies to:

Correct AnswerverifiedShow Answer

Govt. policy about exports and imports is called:

Correct AnswerverifiedShow Answer

What is the Bill receivable account?

Correct AnswerverifiedShow Answer

If purchasing power parity were to hold even in the short run, then:

Correct AnswerverifiedD

The finance manager is accountable for.

Correct AnswerverifiedShow Answer

The forward market is especially well-suited to offer hedging protection against

Correct AnswerverifiedShow Answer

Which bill is drawn and accepted in the same country?

Correct AnswerverifiedShow Answer

Which among the following is not concerned with Chambers of Commerce & Industry

Correct AnswerverifiedShow Answer

Interest Rate Parity (IRP) implies that:

Correct AnswerverifiedB

International trade and domestic trade differ because of:

Correct AnswerverifiedShow Answer

What are the three additional days known as that a drawer gives to the drawee for payment

Correct AnswerverifiedShow Answer

What does financial leverage measure?

Correct AnswerverifiedShow Answer

From the below-mentioned items which are financial assets?

Correct AnswerverifiedC

One example of Small scale Fixed retailers among these is

Correct AnswerverifiedShow Answer

Agents are appointed by?

Correct AnswerverifiedShow Answer

Investment can be defined.

Correct AnswerverifiedShow Answer

The term Euro Currency market refers to

Correct AnswerverifiedShow Answer

Who among the following appoints the agent

Correct AnswerverifiedShow Answer

Goods imported for the purpose of export is known as

Correct AnswerverifiedShow Answer

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D

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B

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C

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