Question 1

Forex reserves of a country are held by ---------------------

Accepted Answer

A)  Commercial Banks
B)  Central Banks
C)  Investment Banks
D)  None of these B

Question 2

MIGA was established in

Accepted Answer

A)  1978
B)  1988
C)  1998
D)  2008 B

Question 3

Open economies are

Accepted Answer

A)  Dependent
B)  Independent
C)  Stable
D)  None of these A

Question 4

The exchange rates in which the spot transactions are carried out are known as

Accepted Answer

A)  Spot rate
B)  ASK rate
C)  Bid rate
D)  Forward rate

Question 5

------------------- system imposes a discipline an monetary authorities

Accepted Answer

A)  Flexible
B)  Fixed
C)  Bretton wood
D)  None of these

Question 6

Devaluation reduces the foreign price of --------------

Accepted Answer

A)  Exports
B)  Imports
C)  Both exports and imports
D)  None of these

Question 7

Price index is considered in ---------------- theory of exchange rate determination

Accepted Answer

A)  BOP theory
B)  PPP theory
C)  Mint Purity theory
D)  None of these

Question 8

Mint parity theory is suitable for ---------

Accepted Answer

A)  Gold standard
B)  Paper standard
C)  Flexible system
D)  None of these

Question 9

The settlement of spot transactions takes place within

Accepted Answer

A)  Tree days
B)  One day
C)  Two days
D)  4 days

Question 10

The ADB was set up in the year

Accepted Answer

A)  976
B)  1967
C)  1965
D)  1966

Question 11

Political instability leads to ------------- in the value of that country's currency

Accepted Answer

A)  Decrease
B)  Stability
C)  Increase
D)  None of these

Question 12

The WTO is the successor to -------------

Accepted Answer

A)  VAT
B)  GATT
C)  GTT
D)  ATT

Question 13

Increased capital inflows increases ------------------

Accepted Answer

A)  Imports
B)  Value of domestic currency
C)  Value of foreign currency
D)  None of these

Question 14

Euro is a ----------

Accepted Answer

A)  Basket Currency
B)  Paper Gold
C)  Gold Currency
D)  None of these

Question 15

When imports increase, the supply of foreign currency -------------

Accepted Answer

A)  Increase
B)  Decrease
C)  Remains constant
D)  None of these

Question 16

Central bank is likely to set policies and procedures to keep the exchange rate ------------------

Accepted Answer

A)  Down
B)  Stable
C)  Up
D)  None of these

Question 17

Which is the world's largest source of concession assistance

Accepted Answer

A)  IFC
B)  IMF
C)  IBRD
D)  IDA

Question 18

Under gold standard the value of the currency unit was defined in terms of -------------

Accepted Answer

A)  Currencies
B)  Silver
C)  Gold
D)  None of these

Question 19

The ADB is managed by -------------

Accepted Answer

A)  Director General
B)  Managing Director
C)  President
D)  None of these

Question 20

Mahalanobis Strategy adopted in the -----------

Accepted Answer

A)  1st five year plan
B)  2nd five year plan
C)  3rd five year plan
D)  4th five year plan

Exam 4: Global Economy: Exchange Rates, Monetary Policies, and Economic Strategies