International Finance and Treasury – Set 1 January 29, 2025 by aasi 0% Report a question What’s wrong with this question? You cannot submit an empty report. Please add some details. 1234567891011121314151617181920212223242526272829303132333435363738394041424344454647484950 International Finance and Treasury – Set 1 Dear ! This is International Finance and Treasury – Set 1 Quiz and it contains 50 questions. Keep Learning! 1 / 50 1) Total portfolio hazard is equal to systematic risk plus diversifiable risk equal to systematic risk plus unavoidable risk equal to avoidable risk plus diversifiable risk equal to systematic risk plus no diversifiable risk 2 / 50 2) Markowitz efficient hypothesis initiated in 1958 1959 1961 1960 3 / 50 3) Liquidity risk is: is risk investments bankers face is lower for small OTC is risk associated with secondary market transactions increases whenever interest rates increases 4 / 50 4) In Capital Market Line every investment is infinitely divisible finitely divisible a & b all of answer correct 5 / 50 5) In order to settle on compound growth rate of an investment over period, an investor determine the geometric mean calculus mean arithmetic mean arithmetic median 6 / 50 6) Dollar-cost averaging allows investors to stay away from trouble of buying high and selling least high low highest 7 / 50 7) Comparative edge is specializing actions in which they are More efficient Less Efficient Somewhat efficient Least Efficient 8 / 50 8) If generally interest rates in nation increase, a corporate bond with a fixed interest rate will usually increase in value remain unchanged decrease in value. be returned to corporation. 9 / 50 9) Agency problem is between Manager and Employees Manager and Government Manager and Shareholders Parent to Subsidiary 10 / 50 10) Features of international business that a organization may be exposed to Exchange rates Foreign economic conditions Political risk All of answers are correct 11 / 50 11) Mainly general type of Direct Foreign Investment (DFI) is Franchising The establishment of new subsidiaries International trade Patent 12 / 50 12) Financial hazard is most related with use of equity financing by corporations use of debt financing by corporations equity investments held by corporations debt investment held by corporations 13 / 50 13) A closed-end fund is a mutual fund in which shares issue just when fund is organized unorganized copied random behaviour showing 14 / 50 14) Choice of correlation coefficient is between 0 to 1 0 to 2 Minus 1 to +1 Minus 1 to 3 15 / 50 15) Hold two securities as an alternative of will not decrease hazard occupied by an investor if two securities are perfectively positive correlated perfectively negative correlated no correlation all of answer correct 16 / 50 16) Agency cost can be decreased by Decentralized Structure Centralized and Decentralized Structure Centralized Structure None of these 17 / 50 17) Greater exposure bigger the Investment Spot rate Forward rate Risk 18 / 50 18) Expected worth is the inverse of standard deviation correlation between a security same as discrete probability distribution weighted average of all possible outcomes 19 / 50 19) Which of following is not a cause for global investment? To gain access to important raw materials. To produce products and/or services more efficiently than possible domestically. To provide an expected risk-adjusted return in excess of that required. International investments have less political risk than domestic investments. 20 / 50 20) A main difference among real and nominal interest proceeds is that real returns adjust for inflation and nominal returns do not real returns use actual cash flows and nominal use expected cash flows real interest adjusts for commissions and nominal returns do not real returns show highest possible return and nominal returns show lowest possible returns 21 / 50 21) Which of following is not a type of direct foreign investment? Franchising International trade Joint ventures Acquisitions of existing operations 22 / 50 22) One of generally prevalent aspects conflicting with recognition of ambition of an MNC is existence of Agency problem Licensing Corporate Governance Management 23 / 50 23) Choice of financial managing can be split down into choices of Financing and investment Investment, financing, and asset management Financing and dividend Capital budgeting, cash management, and credit management 24 / 50 24) Asset allocation is procedure of scattering your assets between numerous different kinds of investments to highest risk moderate risk lessen risk no risk 25 / 50 25) Impact of 9/11 is Political Instability Terrorist Attack More foreign investment Economic Instability 26 / 50 26) Standard deviation determine systematic risk of a security unsystematic risk of security total risk of security premium of security 27 / 50 27) Who concern with relations between security returns Markowitz diversification random diversification Friedman diversification correlating diversification 28 / 50 28) Non-systematic risk is furthermore identified as no diversifiable risk market risk random risk company specific risk 29 / 50 29) Superior portfolio is not basically a collection of individually good portfolio good investments negative securities all of answer correct 30 / 50 30) Below Product Cycle Theory, overseas demand can be primarily contented by Exporting Importing Licensing Mobility of funds 31 / 50 31) An Acquisition is More risky than other foreign investment techniques Less risky than other foreign investment techniques A way to share control over foreign operations A way to share risk of a new foreign investment 32 / 50 32) Ambiguity introduced by way by which organization finances its investments is country risk liquidity risk financial risk business risk 33 / 50 33) Joint venture is Not jointly owned by Jointly owned by two or more firms Acquired by firm It is licensing 34 / 50 34) Worldwide trade is Buying goods from abroad Selling good to abroad Paying Foreign Currency All of answers are correct 35 / 50 35) A price weighted index is an arithmetic mean of future prices current prices quarter prices none of these 36 / 50 36) Most unsafe mode by which firms perform worldwide business is Licensing Franchising International Trade The establishment of new subsidiaries 37 / 50 37) We multiply foreign revenue with rate with respect to that country is Forward rate Spot rate Cash Flows Portfolio Investment 38 / 50 38) Example of a market deficiency is Restrictions on transfer of labour Restrictions on transfer of funds Restrictions on capital flows during currency crisis All of answers are correct 39 / 50 39) Most favourable portfolio is proficient portfolio with the lowest risk highest risk highest utility least investment 40 / 50 40) Aim of MNC is to boost accounting profitability by shifting funds around the Country Region World Market 41 / 50 41) Which type of market efficiency declares that current security prices totally reflect all information, equally public and private Weak Semi-strong Strong none of these 42 / 50 42) Capital Market Line is firstly initiated by Mohsin Linter Markowitz William Sharpe 43 / 50 43) Investments would grade uppermost with regard to protection is government bonds common stock preferred stock real estate 44 / 50 44) Investors should be agreeing to invest in riskier investments merely if return is short if there are no safe alternatives except for holding cash if expected return is adequate for risk level if there are true speculators 45 / 50 45) Slightest hazardous method by which organizations carry out international trade is Licensing Franchising International Trade The establishment of new subsidiaries 46 / 50 46) Trustee is a self-governing organization that operates as bondholders partner guardian broker representative 47 / 50 47) Political constancy is chief aspect concerning exchange risk systematic risk non-systematic risk country risk 48 / 50 48) A corporate bond is a corporation’s write undertaking that it will refund a specific amount of money plus premium interest nothing security 49 / 50 49) Markowitz model presumed generally investors are risk averse risk natural risk seekers risk moderate 50 / 50 50) Bondholders usually accept interest payments each 1 year six months 2 months 2 years Your score isThe average score is 0%🎉 Challenge alert! 💡 Share this quiz with your friends and see who scores the highest! 🏆🤩🔥 LinkedIn Facebook Follow Us @ 0% Restart quiz Exit We’d love to hear your thoughts! 📝 Share your valuable review with us. 🙌 🌟 Thank you for your support! 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