Question 1

Intracompany trade makes up more than ____ percent of all international trade.

Accepted Answer

A) 50 
B) 70 
C) 25 
D) 13 
E) 5 
A) 50 
B) 70 
C) 25 
D) 13 
E) 5

Question 2

Outsourcing is the process of subcontracting to a third party in another country to provide supplies or services that were previously obtained internally.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is mentioned in the text as a possible means by which the government may attempt to improve its balance-of-trade position (increase its exports or reduce its imports)?

Accepted Answer

A) The government could attempt to reduce its home currency's value. 
B) The government could require firms to engage in outsourcing. 
C) The government could provide subsidies to importers. 
D) All of the above are mentioned. 
A) The government could attempt to reduce its home currency's value. 
B) The government could require firms to engage in outsourcing. 
C) The government could provide subsidies to importers. 
D) All of the above are mentioned.

Question 4

Like the International Monetary Fund (IMF), the ____ is composed of a number of nations as members. However, unlike the IMF, it uses the private rather than the government sector to achieve its objectives.

Accepted Answer

A) World Bank 
B) International Finance Corporation (IF
C)  
C) World Trade Organization (WTO) 
D) International Development Association (ID
A)  
E) Bank for International Settlements (BIS) 
A) World Bank 
B) International Finance Corporation (IF
C)  
C) World Trade Organization (WTO) 
D) International Development Association (ID
A)  
E) Bank for International Settlements (BIS)

Question 5

The primary income component in a country's current account may reflect income received due to:

Accepted Answer

A) grants. 
B) direct foreign investment. 
C) aid. 
D) giFts. 
A) grants. 
B) direct foreign investment. 
C) aid. 
D) giFts.

Question 6

A balance-of-trade surplus indicates an excess of imports over exports.

Accepted Answer

A) True 
 B)False

Question 7

Recently, the U.S. experienced an annual balance of trade representing a ____.

Accepted Answer

A) large surplus (exceeding $100 billion) 
B) small surplus 
C) level of zero 
D) deficit 
A) large surplus (exceeding $100 billion) 
B) small surplus 
C) level of zero 
D) deficit

Question 8

If the home currency begins to appreciate against other currencies, this should ____ the current account balance, other things being equal (assume that substitutes are readily available in other countries, and that the prices charged by firms remain the same).

Accepted Answer

A) increase 
B) have no impact on 
C) reduce 
D) all of the above are equally possible 
A) increase 
B) have no impact on 
C) reduce 
D) all of the above are equally possible

Question 9

A weakening of the U.S. dollar with respect to the British pound would likely reduce U.S. exports to Britain and increase U.S. imports from Britain over time.

Accepted Answer

A) True 
 B)False

Question 10

Regarding the U.S. balance of payments, capital account items are relatively minor compared to the financial account items.

Accepted Answer

A) True 
 B)False

Question 11

Over the last several years, international trade has generally:

Accepted Answer

A) increased for most major countries. 
B) decreased for most major countries. 
C) stayed about constant for most major countries. 
D) increased for about half the major countries and decreased for the others. 
A) increased for most major countries. 
B) decreased for most major countries. 
C) stayed about constant for most major countries. 
D) increased for about half the major countries and decreased for the others.

Question 12

The International Development Association was established to promote economic development:

Accepted Answer

A) in Asia through grants to businesses. 
B) by providing nonsubsidized loans (at market interest rates) to governments and their agencies. 
C) by providing low-interest-rate loans (below-market rates) to poor nations. 
D) through the private sector by providing loans to corporations and investing in their stock. 
A) in Asia through grants to businesses. 
B) by providing nonsubsidized loans (at market interest rates) to governments and their agencies. 
C) by providing low-interest-rate loans (below-market rates) to poor nations. 
D) through the private sector by providing loans to corporations and investing in their stock.

Question 13

The current account represents the investment in fixed assets in foreign countries that can be used to conduct business operations.

Accepted Answer

A) True 
 B)False

Question 14

The ____, an accord among 117 nations, called for lower tariffs around the world.

Accepted Answer

A) General Agreement on Tariffs and Trade (GATT) 
B) North American Free Trade Agreement (NAFT
A)  
C) Single European Act of 1987 
D) European Union Accord 
E) none of the above 
A) General Agreement on Tariffs and Trade (GATT) 
B) North American Free Trade Agreement (NAFT
A)  
C) Single European Act of 1987 
D) European Union Accord 
E) none of the above

Intracompany trade makes up more than ____ percent of all international trade.

Outsourcing is the process of subcontracting to a third party in another country to provide supplies or services that were previously obtained internally.

Which of the following is mentioned in the text as a possible means by which the government may attempt to improve its balance-of-trade position (increase its exports or reduce its imports)?

Like the International Monetary Fund (IMF), the ____ is composed of a number of nations as members. However, unlike the IMF, it uses the private rather than the government sector to achieve its objectives.

The primary income component in a country's current account may reflect income received due to:

A balance-of-trade surplus indicates an excess of imports over exports.

Recently, the U.S. experienced an annual balance of trade representing a ____.

If the home currency begins to appreciate against other currencies, this should ____ the current account balance, other things being equal (assume that substitutes are readily available in other countries, and that the prices charged by firms remain the same).

A weakening of the U.S. dollar with respect to the British pound would likely reduce U.S. exports to Britain and increase U.S. imports from Britain over time.

Regarding the U.S. balance of payments, capital account items are relatively minor compared to the financial account items.

Over the last several years, international trade has generally:

The International Development Association was established to promote economic development:

The current account represents the investment in fixed assets in foreign countries that can be used to conduct business operations.

The ____, an accord among 117 nations, called for lower tariffs around the world.

Multinational Financial Management: An Overview

International Financial Markets

Exchange Rate Determination

Currency Derivatives

Government Influence on Exchange Rates

International Arbitrage and Interest Rate Parity

Relationships among Inflation, Interest Rates, and Exchange Rates

Forecasting Exchange Rates

Measuring Exposure to Exchange Rate Fluctuations

Managing Transaction Exposure

Managing Economic Exposure and Translation Exposure

Direct Foreign Investment

Multinational Capital Budgeting

International Corporate Governance and Control

Country Risk Analysis

Multinational Cost of Capital and Capital Structure

Long-Term Debt Financing

Financing International Trade

Short-Term Financing

International Cash Management

Filters

Exam 2: International Flow of Funds

Intracompany trade makes up more than ____ percent of all international trade.

Outsourcing is the process of subcontracting to a third party in another country to provide supplies or services that were previously obtained internally.

Which of the following is mentioned in the text as a possible means by which the government may attempt to improve its balance-of-trade position (increase its exports or reduce its imports)?

Like the International Monetary Fund (IMF), the ____ is composed of a number of nations as members. However, unlike the IMF, it uses the private rather than the government sector to achieve its objectives.

The primary income component in a country's current account may reflect income received due to:

A balance-of-trade surplus indicates an excess of imports over exports.

Recently, the U.S. experienced an annual balance of trade representing a ____.

If the home currency begins to appreciate against other currencies, this should ____ the current account balance, other things being equal (assume that substitutes are readily available in other countries, and that the prices charged by firms remain the same).

A weakening of the U.S. dollar with respect to the British pound would likely reduce U.S. exports to Britain and increase U.S. imports from Britain over time.

Regarding the U.S. balance of payments, capital account items are relatively minor compared to the financial account items.

Over the last several years, international trade has generally:

The International Development Association was established to promote economic development:

The current account represents the investment in fixed assets in foreign countries that can be used to conduct business operations.

The ____, an accord among 117 nations, called for lower tariffs around the world.

Multinational Financial Management: An Overview

International Financial Markets

Exchange Rate Determination

Currency Derivatives

Government Influence on Exchange Rates

International Arbitrage and Interest Rate Parity

Relationships among Inflation, Interest Rates, and Exchange Rates

Forecasting Exchange Rates

Measuring Exposure to Exchange Rate Fluctuations

Managing Transaction Exposure

Managing Economic Exposure and Translation Exposure

Direct Foreign Investment

Multinational Capital Budgeting

International Corporate Governance and Control

Country Risk Analysis

Multinational Cost of Capital and Capital Structure

Long-Term Debt Financing

Financing International Trade

Short-Term Financing

International Cash Management

Filters