International Finance and Treasury – Set 15 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 15 Dear ! This is International Finance and Treasury – Set 15 Quiz and it contains 50 questions. Keep Learning! 1 / 50 1) Which exchange rate theory focuses on the inflation exchange rate relationship? Interest rate parity International Fisher Effect Purchasing power parity Traditional Model 2 / 50 2) SIBOR refers to static interest bonds offered rate Singapore international bonds offered rate simple interest bearing offshore rate Singapore interbank offered rate 3 / 50 3) Syndication of loans is done in Eurocredit market Eurobond market Euronote market All of these 4 / 50 4) International Finance Corporation established in 1956 1960 1966 1970 5 / 50 5) International Financial Corporation established in the year 1948 1952 1962 1956 6 / 50 6) Difference between buying and selling rates in an exchange rate or interest rate quotation is known as Strike price Spread Swap points Spot rate 7 / 50 7) A deposit or borrowing domiciled outside the home country of the currency is called as foreign bond euro bond euro currency domestic bond 8 / 50 8) The bank account of a non-resident of a country, where the amount of currency in the account cannot be transferred to another country is called as Nostro account Blocked Account Foreign account Capital account 9 / 50 9) The Bretton Woods System called for: The IMF to promote development Floating exchange rates against the Japanese Yen Fixed exchange rates against the US Dollar Floating exchange rates against US Dollar 10 / 50 10) Agreement to exchange one currency for another at a specified exchange rate and date is Currency swap Swap points Currency put option Currency call option 11 / 50 11) Full fledged money changers are authorized to undertake only sale transactions only purchase transactions all types of foreign exchange transactions purchase and sale of foreign currency notes, coins and travellers cheques 12 / 50 12) The maximum amount that an Indian company can issue as ADR/GDR in a year is USD 500 million USD 30 million USD 20 million No monetary ceiling 13 / 50 13) At present the role of IMF in the exchange rate policies of its members is to prohibit floating rate have surveillance and express opinion on policies restrict the exchange fluctuations within a band prohibit fixed rate 14 / 50 14) Foreign exchange transactions involve monetary transactions among residents of the same country among residents of the same country between residents of two or more countries among residents of at least three countries 15 / 50 15) Which of the following is not an example of an international trade draft? Time draft Sight draft Both the first and second answers are correct Usance draft 16 / 50 16) Euro is the official currency of All the States of Europe All the states of European Union Only 12 of the states of European Union Only 10 of the States of European Union 17 / 50 17) The number of nostro accounts that can be maintained by a bank in a particular currency is One not exceeding three minimum two no such limit 18 / 50 18) The exchange rate prevailing at a financial reporting date Closing exchange rate Opening exchange rate Fixed exchange rate Fluctuating exchange rate 19 / 50 19) This is not established method of translation Current rate method Monetary/Non-monetary method Temporary method Current/Non-current method 20 / 50 20) The most liquid asset among the following is? Gold Share Cash Land 21 / 50 Conversion at market rates Conversion at market rates, but subject to quantity restriction by government Conversion at market rate without any quantitative restriction by government Conversion at official rate 22 / 50 22) A contract that gives the buyer the right to buy commodity or a foreign currency from the seller at a fixed price is called as put option call option cross option currency swap 23 / 50 23) Bretton woods agreement arrived at in 01-07-94 01-07-54 31-06-60 01-06-64 24 / 50 24) Which of the following is not a reason for international investment? To provide an expected risk-adjusted return in excess of that required To gain access to important raw materials To produce products and/or services more efficiently than possible domestically International investments have less political risk than domestic investments 25 / 50 25) The external method of hedging transaction exposure does not include Forward contact hedge Money market hedge Cross hedging Future hedging 26 / 50 26) The forward exchange rate __________ is the rate today for exchanging one currency for another for immediate delivery is the rate today for exchanging one currency for another at a specific future date is the rate today for exchanging one currency for another at a specific location on a specific future date is the rate today for exchanging one currency for another at a specific location for immediate delivery 27 / 50 27) The system operated by the WTO is known as the multilateral trading system bilateral trading system ratified system ungratified system 28 / 50 28) The first Indian company raised the fund by issuing Bond in US dollar in United States Airtel TATA Reliance Aircel 29 / 50 29) For the purpose of translation exposure, historical rate is the rate prevalent on the date The parent company was established The foreign subsidiary was established The investment in the subsidiary was made by the parent company The asset was acquired or the liability was incurred 30 / 50 30) The price at which a market maker is prepared to sell a currency or lend money forward rate sport rate bid rate offer rate 31 / 50 31) Under the original scheme IMF, a member country had to obtain the permission of IMF for any devaluation of its currency any devaluation or revaluation of its currency devaluation of its currency at a time exceeding 10% devaluation of its currency exceeding cumulatively 10% 32 / 50 32) Two tier exchange rate system is a form of Different exchange rate Fixed rate Multiple exchange rate Flexible rate 33 / 50 33) The cost of hedging through option includes Option premium Interest on option premium till due date of the contract Both a and b optimum premium and difference between option price and spot price 34 / 50 34) Which organisation of the World Bank Group deals with matters related to the development of the poorest countries in the world? The International Bank for Reconstruction and Development The International Development Association The International Finance Corporation The Multilateral Investment Agency 35 / 50 35) Long-term securities denominated in two currencies is called as Euro bond Dual currency bonds Foreign bonds Euro dollar deposit 36 / 50 36) The price at which a market maker is prepared to buy a currency or borrow money is termed as spot rate bid rate ask price forward rate 37 / 50 37) A bank located usually in another country that provides service for another bank is Foreign bank Central bank Correspondent bank World Bank 38 / 50 38) An operation in order to protect the domestic currency value of an asset or a liability that is denominated in foreign currency is called as Hedging Hermes Indexation Leading 39 / 50 39) Purchasing-power parity (PPP) refers to__________ the concept that the same goods should sell for the same price across countries after exchange rates are taken into account the concept that interest rates across countries will eventually be the same the orderly relationship between spot and forward currency exchange rates and the rates of interest between countries the natural offsetting relationship provided by costs and revenues in similar market environments 40 / 50 40) Exchange rate between currency A and currency B, given the values of currencies A and B with respect to a third currency is known as Golden standard lexible exchange rate Fixed exchange rate Cross exchange rate 41 / 50 41) Under fixed exchange rate system, fall in the value of domestic currency due to deficit in balance of payments resulted in depreciation of the currency devaluation of the currency appreciation of the currency no change in the exchange rate normally 42 / 50 42) The spot exchange rate __________ is the rate today for exchanging one currency for another for immediate delivery is the rate today for exchanging one currency for another at a specific future date is the rate today for exchanging one currency for another at a specific location on a specific future date is the rate today for exchanging one currency for another at a specific location for immediate delivery 43 / 50 43) The __________ is especially well suited to offer hedging protection against transactions risk exposure forward market spot market transactions market inflation-rate market 44 / 50 44) A group of European countries have formed a union and created a common currency known as __________ the EU currency the European Union the EMU the Euro 45 / 50 45) The market where long term securities (shares, bonds, etc. are bought and sold is called as money market capital market primary market secondary market 46 / 50 46) Pegging the value of a currency can be done by pegging to a major currency pegging to a basket of currencies pegging to SDR any of these 47 / 50 47) Foreign currency exposures can be avoided by Entering into forward contracts Denominating the transaction in domestic currency Exposure netting Maintaining foreign currency accounts 48 / 50 48) Forward contract is an agreement to buy or sell an assets on Specified price Specified time Specified date Specified volume 49 / 50 49) According to classification by IMF, the currency system of India falls under managed floating independently floating crawling peg pegged to basket of currencies 50 / 50 50) FRAs can’t be used for Hedging Arbitraging Speculating Any of these 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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