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Quiz 1
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Q.1
What is the main reason for shifting profits from one country to another country?
To benefit from a difference in tax rates
To avoid double taxation
To benefit from investment opportunities
To increase overall pre-tax profits
Q.2
Which choice is classified as political risk factors?
Currency Inconvertibility
Corruption
War
All Of above
Q.3
Why firms pursue international business?
To seek comparative advantage
To avoid market restriction
To achieve new market target
All Of above
Q.4
Which one is classified as 'capital' in financial term?
Equity
Trading
Working capital
All Of above
Q.5
Which of the following is not the purposes of international financial management?
It is closely related to other activities in an organization such as asset management, marketing management, or human resource management.
It helps managers to plan and estimate reasonable costs for situations that arise in the future.
It assures the sustainable management of resources globally.
It will help businesses easily find new sources of profits such as investment in equity and loans.
Q.6
What is the simplest type of exchange exposure?
Transaction exposure
Translation exposure
Economic exposure
Q.7
Which one is an example of human risk?
A teller accidentally gives an extra $50 bill to a customer
Borrowers default on a principal or interest payment of a loan
Computer hacking
A large number of depositors withdraw their deposits at bank
Q.8
Which one is an example of human risk?
A teller accidentally gives an extra $50 bill to a customer
Borrowers default on a principal or interest payment of a loan
Computer hacking
A large number of depositors withdraw their deposits at bank
Q.9
The technique that relies on computer modeling of different scenarios and computation of the results of those scenarios on bank’s portfolio is
Stress Testing
Value at Risk (VaR)
Altman's Z Score model
The Standardised Approach
Q.10
What type of risk that occurs from the failure of borrowers to make required payments on loans?
Liquidity risk
Credit risk
Operational risk
Market risk
Q.11
There are more than two parties in multilateral netting
True
False
Q.12
Which ratio below is used to measure financial leverage?
Fixed costs / Variable costs
Sales / Total assets
Debt / Equity
Current assets / Long-term assets
Q.13
What is the most important activity among the cash flow sources?
Investment activity
Operating activity
Financing activity
None of above
Q.14
Equity comes from:
Bond issues
Loans
Receivables
None of above
Q.15
Who is the player in foreign exchange market?
Commercial banks
Retailers
Wholesalers
Workers
Q.16
Which one is not the international trade flows?
Regional trade bloc
Trade agreements
Tariffs
Exports and imports
Q.17
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
Q.18
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
Flexible exchange rate
Fixed exchange rate
Cross exchange rate
Q.19
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
Q.20
Long-term securities denominated in two currencies is called as
Euro bond
Dual currency bonds
Foreign bonds
Euro dollar deposit
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