Question 1

A promise of future payment issued by a firm guaranteed by a bank is called a (n)

Accepted Answer

A) bill of exchange 
B) commercial letter of credit 
C) banker's acceptance 
D) documentary draft 
A) bill of exchange 
B) commercial letter of credit 
C) banker's acceptance 
D) documentary draft

Question 2

Which of the following statements is false?

Accepted Answer

A) An order bill of lading carries title to the goods being shipped. 
B) There are no foreign offices of U.S.banks in foreign countries. 
C) In dealing with a foreign bank,an exporter generally works through a local subsidiary of that bank. 
D) All of the above statements are false. 
A) An order bill of lading carries title to the goods being shipped. 
B) There are no foreign offices of U.S.banks in foreign countries. 
C) In dealing with a foreign bank,an exporter generally works through a local subsidiary of that bank. 
D) All of the above statements are false.

Question 3

Foreign exporters are usually quite willing to accept Chinese Yuan in payment for goods and services because:

Accepted Answer

A) of the importance of the Chinese Yuan in international trade 
B) the value of the dollar does not fluctuate 
C) they have little alternative 
D) it is customary to receive payment denominated in the currency of the importer's country 
E) none of the above 
A) of the importance of the Chinese Yuan in international trade 
B) the value of the dollar does not fluctuate 
C) they have little alternative 
D) it is customary to receive payment denominated in the currency of the importer's country 
E) none of the above

Question 4

Economic risk is the risk associated with possible slow or negative economic growth,as well as with the likelihood of variability.

Accepted Answer

A) True 
 B)False

Question 5

If the exchange rate in New York for British pounds sterling is quoted at 1 pound = $1.60,and in London the rate is quoted at 1 pound = $1.62,financial arbitragers might:

Accepted Answer

A) buy pounds in New York 
B) sell dollars in London 
C) simultaneously sell pounds in New York and buy dollars in London 
D) simultaneously sell pounds in New York and sell dollars in London 
E) none of the above 
A) buy pounds in New York 
B) sell dollars in London 
C) simultaneously sell pounds in New York and buy dollars in London 
D) simultaneously sell pounds in New York and sell dollars in London 
E) none of the above

Question 6

Which of the following statements is most correct?

Accepted Answer

A) The benefits of international specialization of effort are so great that a nation should pursue such a policy irrespective of the policies of other nations. 
B) Arbitrage in the international exchange market has the unfortunate effect of creating instability in exchange rates. 
C) The trust receipt is used by a bank in releasing shipping documents to a customer when the bank wishes to retain title to the merchandise. 
D) The bankers' acceptance and the commercial letter of credit involve three principal parties: the importer,the importer's bank,and the exporter. 
A) The benefits of international specialization of effort are so great that a nation should pursue such a policy irrespective of the policies of other nations. 
B) Arbitrage in the international exchange market has the unfortunate effect of creating instability in exchange rates. 
C) The trust receipt is used by a bank in releasing shipping documents to a customer when the bank wishes to retain title to the merchandise. 
D) The bankers' acceptance and the commercial letter of credit involve three principal parties: the importer,the importer's bank,and the exporter.

Question 7

Which of the following statements is false?

Accepted Answer

A) An order bill of lading carries title to the goods being shipped. 
B) There are foreign offices of U.S.banks in foreign countries. 
C) In dealing with a foreign bank,an exporter generally works through a local subsidiary of that bank. 
D) All of the above statements are false. 
E) none of the above statements is false. 
A) An order bill of lading carries title to the goods being shipped. 
B) There are foreign offices of U.S.banks in foreign countries. 
C) In dealing with a foreign bank,an exporter generally works through a local subsidiary of that bank. 
D) All of the above statements are false. 
E) none of the above statements is false.

Question 8

A documentary draft is accompanied,among other things,by a (n):

Accepted Answer

A) order bill of lading 
B) manifest 
C) trust receipt 
D) letter of credit 
A) order bill of lading 
B) manifest 
C) trust receipt 
D) letter of credit

Question 9

Political risk is the risk associated with possible slow or negative economic growth,as well as with the likelihood of variability.

Accepted Answer

A) True 
 B)False

A promise of future payment issued by a firm guaranteed by a bank is called a (n)

Which of the following statements is false?

Foreign exporters are usually quite willing to accept Chinese Yuan in payment for goods and services because:

Economic risk is the risk associated with possible slow or negative economic growth,as well as with the likelihood of variability.

If the exchange rate in New York for British pounds sterling is quoted at 1 pound = $1.60,and in London the rate is quoted at 1 pound = $1.62,financial arbitragers might:

Which of the following statements is most correct?

Which of the following statements is false?

A documentary draft is accompanied,among other things,by a (n):

Political risk is the risk associated with possible slow or negative economic growth,as well as with the likelihood of variability.

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Business Organization and Financial Data

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters

Exam 6: International Finance and Trade

A promise of future payment issued by a firm guaranteed by a bank is called a (n)

Which of the following statements is false?

Foreign exporters are usually quite willing to accept Chinese Yuan in payment for goods and services because:

Economic risk is the risk associated with possible slow or negative economic growth,as well as with the likelihood of variability.

If the exchange rate in New York for British pounds sterling is quoted at 1 pound = $1.60,and in London the rate is quoted at 1 pound = $1.62,financial arbitragers might:

Which of the following statements is most correct?

Which of the following statements is false?

A documentary draft is accompanied,among other things,by a (n):

Political risk is the risk associated with possible slow or negative economic growth,as well as with the likelihood of variability.

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Business Organization and Financial Data

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters