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Management
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Quiz 15
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Q.1
Type of index in which current values of stock are added together and divided by value of stock on base date is classified as
value weighted index
herring weighted index
primary market index
stock market index
Q.2
Buying price of stock is $35 and it can be sold for $30 whereas dividend paid is $6 then return on stock is
36.67%
46.67%
26.67%
26.67%
Q.3
Ambiguity introduced by way by which organization finances its investments is
country risk
liquidity risk
financial risk
business risk
Q.4
If generally interest rates in nation increase, a corporate bond with a fixed interest rate will usually
increase in value
remain unchanged
decrease in value.
be returned to corporation.
Q.5
A main difference among real and nominal interest proceeds is that
real returns adjust for inflation and nominal returns do not
real returns use actual cash flows and nominal use expected cash flows
real interest adjusts for commissions and nominal returns do not
real returns show highest possible return and nominal returns show lowest possible returns
Q.6
Which of following is not a type of direct foreign investment?
Franchising
International trade
Joint ventures
Acquisitions of existing operations
Q.7
Comparative edge is specializing actions in which they are
More efficient
Less Efficient
Somewhat efficient
Least Efficient
Q.8
Financial hazard is most related with
use of equity financing by corporations
use of debt financing by corporations
equity investments held by corporations
debt investment held by corporations
Q.9
Mainly general type of Direct Foreign Investment (DFI) is
Franchising
The establishment of new subsidiaries
International trade
Patent
Q.10
Worldwide trade is
Buying goods from abroad
Selling good to abroad
Paying Foreign Currency
All of answers are correct
Q.11
Slightest hazardous method by which organizations carry out international trade is
Licensing
Franchising
International Trade
The establishment of new subsidiaries
Q.12
One of generally prevalent aspects conflicting with recognition of ambition of an MNC is existence of
Agency problem
Licensing
Corporate Governance
Management
Q.13
Effective tool of excellent corporate governance corporation are
Board of directors
Common stock shareholders
Top executive officers
All of answers are correct
Q.14
Expected worth is the
inverse of standard deviation
correlation between a security
same as discrete probability distribution
weighted average of all possible outcomes
Q.15
Liquidity risk is:
is risk investments bankers face
is lower for small OTC
is risk associated with secondary market transactions
increases whenever interest rates increases
Q.16
An Acquisition is
More risky than other foreign investment techniques
Less risky than other foreign investment techniques
A way to share control over foreign operations
A way to share risk of a new foreign investment
Q.17
Choice of financial managing can be split down into choices of
Financing and investment
Investment, financing, and asset management
Financing and dividend
Capital budgeting, cash management, and credit management
Q.18
Agency problem is between
Manager and Employees
Manager and Government
Manager and Shareholders
Parent to Subsidiary
Q.19
Most unsafe mode by which firms perform worldwide business is
Licensing
Franchising
International Trade
The establishment of new subsidiaries
Q.20
In real world, all factors of production are perfectly
Mobile
Immobile
Somewhat mobile
All of answers are correct
Q.21
Impact of 9/11 is
Political Instability
Terrorist Attack
More foreign investment
Economic Instability
Q.22
Snyder Golf Co desire to build a golf club in Brazil they will do
Exporting
Importing
Direct Foreign Investment
Licensing
Q.23
General Agreement on Tariffs and Trade (GATT)
is an accord reached between 100 countries in 1980
reduced some tariffs by 80 percent on average
removed some tariffs over a five- to ten-year period
made more progress on reducing tariffs in service industries than in manufacturing industries
Q.24
Bondholders usually accept interest payments each
1 year
six months
2 months
2 years
Q.25
Greater exposure bigger the
Investment
Spot rate
Forward rate
Risk
Q.26
Single European Act created in
1970
1988
1977
1978
Q.27
Agency cost can be decreased by
Decentralized Structure
Centralized and Decentralized Structure
Centralized Structure
None of it
Q.28
Which of following is not a cause for global investment?
To gain access to important raw materials.
To produce products and/or services more efficiently than possible domestically.
To provide an expected risk-adjusted return in excess of that required.
International investments have less political risk than domestic investments.
Q.29
Aim of MNC is to boost accounting profitability by shifting funds around the
Country
Region
World
Market
Q.30
Licensing permits firms to employ their expertise in foreign marketplace without a
Investment
Acquisition of Subsidiary
International trade
Major investment in foreign countries
Q.31
One of biggest borrowers in globe is
World trade Organization
International Monetary fund
World Bank
International financial Corporation
Q.32
Below Product Cycle Theory, overseas demand can be primarily contented by
Exporting
Importing
Licensing
Mobility of funds
Q.33
Political hazard is related to danger of loss of worth due to
Government or Public actions
Exchange rate movements
Poor corporate governance
Unfavourable trade negotiations
Q.34
Berlin wall eliminate in
1980
1983
1988
1989
Q.35
Selling of products outward home country referred to
imports
currency Devaluation
exports
loans
Q.36
Uruguay Round that has started
earlier 8 years
earlier 5 years
earlier 10 year
earlier 7 years
Q.37
We multiply foreign revenue with rate with respect to that country is
Forward rate
Spot rate
Cash Flows
Portfolio Investment
Q.38
Portfolio Investment is dealing in
Same securities
Short term investment
Different securities
Don
Q.39
Not a currency but basically a component of account of
compensatory financing facility
special drawing rights
multilateral investment guarantee agency
structural adjustment loan
Q.40
Current Account in BOP characterize summary of stream of funds between particular country and all other country due to
sale of assets
purchase of goods and services
liabilities of long term
liabilities of short term
Q.41
A corporate bond is a corporation's write undertaking that it will refund a specific amount of money plus
premium
interest
nothing
security
Q.42
Features of international business that a organization may be exposed to
Exchange rates
Foreign economic conditions
Political risk
All of answers are correct
Q.43
Numerous European nations accepted Euro as their currency in
1998
1997
1999
1996
Q.44
Choice of correlation coefficient is between
0 to 1
0 to 2
Minus 1 to +1
Minus 1 to 3
Q.45
In Capital Market Line every investment is
infinitely divisible
finitely divisible
a & b
all of answer correct
Q.46
Which of following is not a means in which agency troubles can be lessen through corporate rule?
Executive compensation
Threat of hostile takeover
Acquisition of a foreign subsidiary
Monitoring by large shareholders
Q.47
Investors take political hazard as
Encouraged
Discouraged
Attracted
Make them happy
Q.48
Hold two securities as an alternative of will not decrease hazard occupied by an investor if two securities are
perfectively positive correlated
perfectively negative correlated
no correlation
all of answer correct
Q.49
Formed in 1960 is
World Trade Organization
World Bank
Regional Development Agency
International Development Association
Q.50
From this which is NOT a cash outflow for organization
depreciation.
dividends.
interest payments.
taxes.
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