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MCQs

Total Questions : 176 | Page 2 of 18 pages
Question 11. Exchange rate entail delivery of trade currency within two business days know as
  1.    forward rate
  2.    future rate
  3.    spot rate
  4.    bid rate
 Discuss Question
Answer: Option C. -> spot rate
Answer: (c).spot rate
Question 12. Eurobonds are admired because
  1.    they are less risky than traditional bonds
  2.    European companies are considered very stable
  3.    of absence of government regulation
  4.    they are always denominated in euro
 Discuss Question
Answer: Option C. -> of absence of government regulation
Answer: (c).of absence of government regulation
Question 13. Simplicity with which bondholders and shareholders can change their investments into cash is known
  1.    barter
  2.    hedging
  3.    arbitrage
  4.    liquidity
 Discuss Question
Answer: Option D. -> liquidity
Answer: (d).liquidity
Question 14. Bid quote is for
  1.    seller
  2.    buyer
  3.    hedger
  4.    speculator
 Discuss Question
Answer: Option B. -> buyer
Answer: (b).buyer
Question 15. Differences in nominal interest rates are removed in exchange rate is
  1.    the fisher effect
  2.    the Leontief paradox.
  3.    the combined equilibrium theory.
  4.    the purchasing power parity
 Discuss Question
Answer: Option A. -> the fisher effect
Answer: (a).the fisher effect
Question 16. If your local currency is in variable form and foreign currency is in fixed form quotation will be:
  1.    indirect
  2.    direct
  3.    local form
  4.    foreign form
 Discuss Question
Answer: Option B. -> direct
Answer: (b).direct
Question 17. In a quote exchange rate, currency that is to be purchase with another currency is called :
  1.    liquid currency
  2.    foreign currency
  3.    local currency
  4.    base currency
 Discuss Question
Answer: Option D. -> base currency
Answer: (d).base currency
Question 18. Holding an inventory have
  1.    buying cost
  2.    selling cost
  3.    opportunity cost
  4.    exchange rate risk
 Discuss Question
Answer: Option C. -> opportunity cost
Answer: (c).opportunity cost
Question 19. Today, important factor that result in augmentation in international bond market is
  1.    low interest rates
  2.    high interest rates
  3.    moderate interest rates
  4.    all of above
 Discuss Question
Answer: Option A. -> low interest rates
Answer: (a).low interest rates
Question 20. Governments enforce currency limitations to
  1.    protect a currency from speculators
  2.    keep resident individuals and businesses from investing in other nations
  3.    preserve hard currencies to finance trade deficits or repay debts
  4.    all of above
 Discuss Question
Answer: Option D. -> all of above
Answer: (d).all of above

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