Question 1

Working capital management involves the management of

Accepted Answer

A) current and long-term assets. 
B) current assets and current liabilities. 
C) current liabilities and long-term assets. 
D) current liabilities and long-term debt and equity. 
A) current and long-term assets. 
B) current assets and current liabilities. 
C) current liabilities and long-term assets. 
D) current liabilities and long-term debt and equity. B

Question 2

A/An ________ is a locally incorporated bank owned in part but not necessarily controlled by a foreign parent.

Accepted Answer

A) banking affiliate 
B) Edge Act Corporation 
C) international branch bank 
D) bank subsidiary 
A) banking affiliate 
B) Edge Act Corporation 
C) international branch bank 
D) bank subsidiary A

Question 3

An Edge Act corporation is a subsidiary of a U.S.bank located outside of the U.S.and incorporated to engage in international banking and financing operations.

Accepted Answer

A) True 
 B)False  False

Question 4

Because they are direct payments,dividends are among the most efficient way for foreign subsidiaries to remit funds back to the parent.

Accepted Answer

A) True 
 B)False

Question 5

Domestic sales are almost always denominated in the local currency,but international sales may be denominated in

Accepted Answer

A) the exporter's currency. 
B) the importer's currency. 
C) a third country's currency. 
D) any of the above. 
A) the exporter's currency. 
B) the importer's currency. 
C) a third country's currency. 
D) any of the above.

Question 6

The accounts payable period of the operating cycle

Accepted Answer

A) may be equal to the inventory period. 
B) may run concurrently but shorter than the inventory period. 
C) may run concurrently but longer than the inventory period. 
D) any one of the above may be true. 
A) may be equal to the inventory period. 
B) may run concurrently but shorter than the inventory period. 
C) may run concurrently but longer than the inventory period. 
D) any one of the above may be true.

Question 7

One possible definition of net working capital (NWC)provided by your authors is

Accepted Answer

A) NWC = A/R + inventory - A/P. 
B) NWC = cash +A/P - inventory. 
C) NWC = A/P + A/R - short-term loans. 
D) NWC = A/R + inventory - long-term debt. 
A) NWC = A/R + inventory - A/P. 
B) NWC = cash +A/P - inventory. 
C) NWC = A/P + A/R - short-term loans. 
D) NWC = A/R + inventory - long-term debt.

Question 8

For the MNE a repositioning of profits helps the firm realize greater after-tax profits from the same amount of sales.

Accepted Answer

A) True 
 B)False

Question 9

The Clearing House Interbank Payment System (CHIPS)is

Accepted Answer

A) the largest publicly operated payments system in the world. 
B) owned and operated by the world's seven largest central banks. 
C) a computerized network that connects banks globally. 
D) none of the above. 
A) the largest publicly operated payments system in the world. 
B) owned and operated by the world's seven largest central banks. 
C) a computerized network that connects banks globally. 
D) none of the above.

Question 10

Unbundling may facilitate allocation of overhead from a parent's international division,so-called shared services,to each operating subsidiary in accordance with a predetermined formula.

Accepted Answer

A) True 
 B)False

Question 11

The proper order of events for the operating cycle is

Accepted Answer

A) input serving period, accounts receivable period, inventory period, quotation period. 
B) quotation period, accounts receivable period, inventory period, input servicing period. 
C) quotation period, input servicing period, inventory period, accounts receivable period. 
D) accounts receivable period, input servicing period, quotation period, inventory period. 
A) input serving period, accounts receivable period, inventory period, quotation period. 
B) quotation period, accounts receivable period, inventory period, input servicing period. 
C) quotation period, input servicing period, inventory period, accounts receivable period. 
D) accounts receivable period, input servicing period, quotation period, inventory period.

Question 12

Dividends are the most tax-efficient way to repatriate funds because they are distributed on an after-tax basis.

Accepted Answer

A) True 
 B)False

Question 13

A foreign banking office that is separately incorporated in the host country is

Accepted Answer

A) a correspondent bank. 
B) a representative office. 
C) a bank subsidiary. 
D) an Edge Act corporation. 
A) a correspondent bank. 
B) a representative office. 
C) a bank subsidiary. 
D) an Edge Act corporation.

Question 14

Japanese markets are noted for their short maturity payment terms (less than 20 days),and the general reluctance of the manufacturer to supply any type of credit to customers.

Accepted Answer

A) True 
 B)False

Question 15

Free-trade zones may take the form of

Accepted Answer

A) warehouses for imported goods. 
B) assembly plants for imported parts. 
C) manufacturing plants for re-export. 
D) all of the above. 
A) warehouses for imported goods. 
B) assembly plants for imported parts. 
C) manufacturing plants for re-export. 
D) all of the above.

Question 16

Which of the following statements is true?

Accepted Answer

A) A/R provide part of the funding for inventory. 
B) A/P provide part of the funding for A/R and inventory. 
C) Inventory pays for A/R and A/P. 
D) None of the above is true. 
A) A/R provide part of the funding for inventory. 
B) A/P provide part of the funding for A/R and inventory. 
C) Inventory pays for A/R and A/P. 
D) None of the above is true.

Question 17

What are the advantages to the parent firm of unbundling the remittance of profits?

Accepted Answer

Unbundling allows a multinational firm t

Question 18

Which of the following is NOT a correspondent banking service?

Accepted Answer

A) accepting bank drafts 
B) honoring letters of credit 
C) furnishing credit informational 
D) All of the above are correspondent bank activities. 
A) accepting bank drafts 
B) honoring letters of credit 
C) furnishing credit informational 
D) All of the above are correspondent bank activities.

Question 19

Days working capital is equal to

Accepted Answer

A) days payables + days receivables - days inventory. 
B) days inventory + days receivables - days payables. 
C) days payables + days inventory + days receivables. 
D) none of the above. 
A) days payables + days receivables - days inventory. 
B) days inventory + days receivables - days payables. 
C) days payables + days inventory + days receivables. 
D) none of the above.

Question 20

Your authors identify four constraints on repositioning funds.Identify and describe three of these constraints.

Accepted Answer

Political constraints - Political constr

Working capital management involves the management of

A/An ________ is a locally incorporated bank owned in part but not necessarily controlled by a foreign parent.

An Edge Act corporation is a subsidiary of a U.S.bank located outside of the U.S.and incorporated to engage in international banking and financing operations.

Because they are direct payments,dividends are among the most efficient way for foreign subsidiaries to remit funds back to the parent.

Domestic sales are almost always denominated in the local currency,but international sales may be denominated in

The accounts payable period of the operating cycle

One possible definition of net working capital (NWC)provided by your authors is

For the MNE a repositioning of profits helps the firm realize greater after-tax profits from the same amount of sales.

The Clearing House Interbank Payment System (CHIPS)is

Unbundling may facilitate allocation of overhead from a parent's international division,so-called shared services,to each operating subsidiary in accordance with a predetermined formula.

The proper order of events for the operating cycle is

Dividends are the most tax-efficient way to repatriate funds because they are distributed on an after-tax basis.

A foreign banking office that is separately incorporated in the host country is

Japanese markets are noted for their short maturity payment terms (less than 20 days),and the general reluctance of the manufacturer to supply any type of credit to customers.

Free-trade zones may take the form of

Which of the following statements is true?

What are the advantages to the parent firm of unbundling the remittance of profits?

Which of the following is NOT a correspondent banking service?

Days working capital is equal to

Your authors identify four constraints on repositioning funds.Identify and describe three of these constraints.

Current Multinational Challenges and the Global Economy

Financial Goals and Corporate Governance

The International Monetary System

The Balance of Payments

Current Multinational Financial Challenges: the Credit Crisis of 2007 - 2009

The Foreign Exchange Market

International Parity Conditions

Foreign Currency Derivatives and Swaps

Foreign Exchange Rate Determination and Forecasting

Transaction and Translation Exposure

Operating Exposure

The Global Cost and Availability of Capital

Sourcing Equity and Debt Globally

Multinational Tax Management

Foreign Direct Investment and Political Risk

Multinational Capital Budgeting and Cross-Border Acquisitions

International Portfolio Theory and Diversification

International Trade Finance

Filters

Exam 18: Working Capital Management

Working capital management involves the management of

A/An ________ is a locally incorporated bank owned in part but not necessarily controlled by a foreign parent.

An Edge Act corporation is a subsidiary of a U.S.bank located outside of the U.S.and incorporated to engage in international banking and financing operations.

Because they are direct payments,dividends are among the most efficient way for foreign subsidiaries to remit funds back to the parent.

Domestic sales are almost always denominated in the local currency,but international sales may be denominated in

The accounts payable period of the operating cycle

One possible definition of net working capital (NWC)provided by your authors is

For the MNE a repositioning of profits helps the firm realize greater after-tax profits from the same amount of sales.

The Clearing House Interbank Payment System (CHIPS)is

Unbundling may facilitate allocation of overhead from a parent's international division,so-called shared services,to each operating subsidiary in accordance with a predetermined formula.

The proper order of events for the operating cycle is

Dividends are the most tax-efficient way to repatriate funds because they are distributed on an after-tax basis.

A foreign banking office that is separately incorporated in the host country is

Japanese markets are noted for their short maturity payment terms (less than 20 days),and the general reluctance of the manufacturer to supply any type of credit to customers.

Free-trade zones may take the form of

Which of the following statements is true?

What are the advantages to the parent firm of unbundling the remittance of profits?

Which of the following is NOT a correspondent banking service?

Days working capital is equal to

Your authors identify four constraints on repositioning funds.Identify and describe three of these constraints.

Current Multinational Challenges and the Global Economy

Financial Goals and Corporate Governance

The International Monetary System

The Balance of Payments

Current Multinational Financial Challenges: the Credit Crisis of 2007 - 2009

The Foreign Exchange Market

International Parity Conditions

Foreign Currency Derivatives and Swaps

Foreign Exchange Rate Determination and Forecasting

Transaction and Translation Exposure

Operating Exposure

The Global Cost and Availability of Capital

Sourcing Equity and Debt Globally

Multinational Tax Management

Foreign Direct Investment and Political Risk

Multinational Capital Budgeting and Cross-Border Acquisitions

International Portfolio Theory and Diversification

International Trade Finance

Filters