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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-8 section-7

Each section contains 100 MCQs on International Finance and Treasury .
71
Mortgages used to purchase townhouses and apartment complexes are classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
Mortgages used to purchase townhouses and apartment complexes are classified as multifamily dwelling mortgages. A mortgage is a loan from a bank or a financial institution that helps the borrower purchase a house. A mortgage is secured by the home itself, so if the borrower defaults on the loan, the bank can sell the home and recoup its losses.
72
Mortgages used to purchase shopping malls and office buildings are classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
Mortgages used to purchase shopping malls and office buildings are classified as commercial mortgages. A commercial mortgage is a mortgage loan secured by commercial property, such as an office building, shopping center, industrial warehouse, or apartment complex. The proceeds from a commercial mortgage are typically used to acquire, refinance, or redevelop commercial property.
73
Global bond market consists of all bonds sold by issued companies, governments, or other firms
Discuss
Answer & Solution
Answer: Option B
Solution:
Global bond market consists of all bonds sold by issued companies, governments, or other firms outside their own countries. A global bond is a type of bond that can be traded in a domestic or European market. It is a bond issued and traded outside the country where the currency of the bond is denominated. This type of bond is issued by a non-European company but sells in a European country or any other foreign market.
74
More instability in currency is called as
Discuss
Answer & Solution
Answer: Option C
Solution:
More instability in currency is called as currency risk. Currency Risk, sometimes referred to as exchange rate risk, is the possibility that currency depreciation will negatively affect the value of one's assets, investments, and their related interest and dividend payment streams, especially those securities denominated in foreign currency.
75
Foreign bonds issued in Japan are known
Discuss
Answer & Solution
Answer: Option D
Solution:
Foreign bonds issued in Japan are known as samurai bonds. A samurai bond is a yen-denominated bond issued in Tokyo by a non-Japanese company and subject to Japanese regulations. Other types of yen-denominated bonds are Euroyens issued in countries other than Japan, typically in London.
76
Largest number of buyers and sellers, greater the
Discuss
Answer & Solution
Answer: Option A
Solution:
Largest number of buyers and sellers, greater the liquidity. Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market at a price reflecting its intrinsic value. In other words: the ease of converting it to cash.
77
Exchange rate entail delivery of trade currency within two business days know as
Discuss
Answer & Solution
Answer: Option C
Solution:
Exchange rate entail delivery of trade currency within two business days know as spot rate. The spot rate is the price quoted for immediate settlement on a commodity, a security or a currency. The spot rate, also referred to as the "spot price," is the current market value of an asset at the moment of the quote.
78
Differences in nominal interest rates are removed in exchange rate is
Discuss
Answer & Solution
Answer: Option A
Solution:
Differences in nominal interest rates are removed in exchange rate is fisher effect. The Fisher Effect is an economic theory created by economist Irving Fisher that describes the relationship between inflation and both real and nominal interest rates. The Fisher Effect states that the real interest rate equals the nominal interest rate minus the expected inflation rate.
79
Simplicity with which bondholders and shareholders can change their investments into cash is known
Discuss
Answer & Solution
Answer: Option D
Solution:
Simplicity with which bondholders and shareholders can change their investments into cash is known as liquidity. Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market at a price reflecting its intrinsic value. In other words: the ease of converting it to cash.
80
Eurobonds are admired because
Discuss
Answer & Solution
Answer: Option C
Solution:
Eurobonds are admired because of absence of government regulation. A Eurobond is a debt instrument that's denominated in a currency other than the home currency of the country or market in which it is issued. Eurobonds are important because they help organizations raise capital while having the flexibility to issue them in another currency.