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International Finance and Treasury MCQ Questions and Solutions with Explanations | Management

International Finance and Treasury MCQ Questions and answers with easy and logical explanations. Management provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. International FinanceMCQ is important for exams like MAT, CAT, CA, CS, CMA, CPA, CFA, UPSC, Banking and other Management department exam. Page-2 section-7

Each section contains 100 MCQs on International Finance and Treasury .
11
Method of auction of futures contract in which traders sell their futures contracts at a specified price by crying out in louder voices is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Method of auction of futures contract in which traders sell their futures contracts at a specified price by crying out in louder voices is classified as open outcry auction. Open outcry is a method of verbal and hand signal communication used by traders at stock and futures exchanges. Signals and shouts convey trading information, intentions, and acceptance in the trading pits.
12
Gross proceeds of stock is $24000 and net proceeds are $35000 then under writers spread is
Discuss
Answer & Solution
Answer: Option D
Solution:
Underwriters spread = Net proceeds - Gross proceeds
= $35000 - $24000 = $11,000.
13
Consider buying call option, if price of stock falls then buyer of call option has
Discuss
Answer & Solution
Answer: Option D
Solution:
Consider buying call option, if price of stock falls then buyer of call option has high potential of losses. Traders buy a call option in the commodities or futures markets if they expect the underlying futures price to move higher. Buying a call option entitles the buyer of the option the right to purchase the underlying futures contract at the strike price any time before the contract expires.
14
Position which occurs because of selling floor and buying cap is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Position which occurs because of selling floor and buying cap is classified as collar. A collar, commonly known as a hedge wrapper, is an options strategy implemented to protect against large losses, but it also limits large gains.
15
Stock holder who does not have any voting rights in corporation is considered as
Discuss
Answer & Solution
Answer: Option B
Solution:
Stock holder who does not have any voting rights in corporation is considered as preferred stockholder. Preferred stock is a type of ownership that receives greater demand on a company's profits and assets than common stock. While preferred shareholders do not typically have a right to vote in the company, they do hold the benefit of being paid dividends before common shareholders.
16
Under writer spread is $47500 and gross proceeds are $34000 then net proceeds are
Discuss
Answer & Solution
Answer: Option A
Solution:
Net proceeds = Under writer spread - Gross proceeds
= $47500 - $34000 = $13,500.
17
Type of voting in which all directors in voting lists are voted at same time is classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Type of voting in which all directors in voting lists are voted at same time is classified as cumulative voting. Cumulative voting is a type of voting system that helps strengthen the ability of minority shareholders to elect a director. This method allows shareholders to cast all of their votes for a single nominee for the board of directors when the company has multiple openings on its board.
18
Type of traders who take position in market of futures which is based on expectations of prices of underlying assets are classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
Type of traders who take position in market of futures which is based on expectations of prices of underlying assets are classified as position traders. Position trader refers to an individual who holds an investment for an extended period of time with the expectation that it will appreciate in value.
19
Type of liability in which stockholders losses are counted for only invested amount in firm is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Limited liability is a type of legal structure for an organization where a corporate loss will not exceed the amount invested in a partnership or limited liability company. In other words, investors' and owners' private assets are not at risk if the company fails.
20
Return to stockholders is 15% and periodic dividend payments are 11.5% then gains on capital are
Discuss
Answer & Solution
Answer: Option B
Solution:
Gains on capital = Return to stockholders - Periodic dividend payments
= 15% - 11.5% = 3.50%.