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

A. Both 1 and 2

B. Both 2 and 3

C. Both 1 and 3

D. Both 2 and 4

A. a wholesaler

B. a broker

C. a bank

D. an investor

A. $$\frac{{\left( {1 + {r_d}} \right)}}{{\left( {1 + {r_f}} \right)}} = \frac{{\frac{{{f_F}}}{D}}}{{\frac{{{S_F}}}{D}}}$$

B. $$\frac{{\left( {1 + {r_f}} \right)}}{{\left( {1 + {r_d}} \right)}} = \frac{{\frac{{{S_F}}}{D}}}{{\frac{{{f_F}}}{D}}}$$

C. $$\frac{{\left( {1 + {r_f}} \right)}}{{\left( {1 + {r_d}} \right)}} = \frac{{\frac{{{f_F}}}{D}}}{{\frac{{{S_F}}}{D}}}$$

D. None of these

A. Swap

B. Cap

C. Floor

D. All of the above

A. currencies fluctuation

B. interest rate differential between two countries

C. demand and supply of two currencies

D. stock market returns

A. Only statement 1 is correct

B. Only statement 3 is correct

C. Both statements 1 and 3 are correct

D. Both statements 2 and 3 are correct

A. Both statements are correct

B. Both statements are incorrect

C. Statement I is correct, but Statement II is incorrect

D. Statement II is correct, but Statement I is incorrect

A. may cause an outward shift in the demand for the currency

B. may cause an inward shift in the supply for the currency

C. may lead to a movement along the demand curve for a currency

D. may be due to an increase in demand for the country's exports

A. (A) is correct, but (R) is incorrect

B. (A) is incorrect, but (R) is correc

C. Both (A) and (R) are incorrect

D. Both (A) and (R) are correct

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