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Management
International Finance And Treasury
Quiz 5
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Q.1
The role if IMF does not include
monitoring the proper conduct of the international monetary system
lending to socially oriented projects
financing temporary balance of payments deficits of member countries
providing source of liquidity to member countries
Q.2
The activities of ADB include
project financing
guaranteeing loans
both a and b
risk management products
Q.3
Under fixed exchange rate system, fall in the value of domestic currency due to deficit in balance of payments resulted in
depreciation of the currency
devaluation of the currency
appreciation of the currency
no change in the exchange rate normally
Q.4
Risk which arises all activities from contingent liabilities and assets is considered as
off balance sheet risk
income statement risk
balance of trade risk
balance of payment risk
Q.5
Ability of an asset to be converted in to cash very quickly is classified as
variable securities
convertible securities
liquidity
constant securities
Q.6
Issuers that are not involved directly in funds transferring are classified as
individual issuers
corporate issuers
local issuers
global issuers
Q.7
Risk which arises from insufficient capital available to balance sudden decrease in assets value is classified as
insolvency risk
solvency risk
balanced risk
unbalanced risk
Q.8
A country has a negative balance of trade it means the balance of payments on current account
Should also be negative
Should be positive
May be positive or negative
Should be same as balance of trade
Q.9
Process of selling and buying of stocks and bonds is classified as
s-trade
b-trade
e-trade
stock trade
Q.10
In commercial banks, subordinate debentures and subordinate notes are considered as
stated rates
banks debentures
banks liabilities
banks deposits
Q.11
Type of financial security having payoffs which are connected to some securities issued some time back is classified as
linked security
previous security
payoff security
derivative security
Q.12
Example of derivative securities includes
swap contract
option contract
futures contract
all of above
Q.13
IMF augments its resources by borrowing under
General arrangements to borrow
New arrangements to borrow
Trust funds
All the above
Q.14
Under the original scheme IMF, a member country had to obtain the permission of IMF for
any devaluation of its currency
any devaluation or revaluation of its currency
devaluation of its currency at a time exceeding 10%
devaluation of its currency exceeding cumulatively 10%
Q.15
At present the role of IMF in the exchange rate policies of its members is to
prohibit floating rate
have surveillance and express opinion on policies
restrict the exchange fluctuations within a band
prohibit fixed rate
Q.16
Type of markets in which derivative securities are traded is classified as
derivative security markets
trading markets
classified markets
non-trading markets
Q.17
Situation in which claims by financial institutions than claims issued by corporations is more considerable for investors is classified as
asset transformers
liability transformers
issuing transformers
claiming transformers
Q.18
Reduction of risk by holding large number of securities in portfolio of assets is classified as
diversification
selling ability
reduction ability
director ability
Q.19
Financial intermediaries that make loans available and accept long term and short term debts for funding are considered as
activity institutions
investment companies
mortgage companies
finance companies
Q.20
Risk faced by financial institutions in which advancement of technology does not produce savings in cost is classified as
savings risk
advance risk
cost risk
technology risk
Q.21
Maturity of debt instruments which faces more price fluctuations is
primary maturity
capital maturity
short term maturity
long term maturity
Q.22
The current account of balance of payments does not include
Trade in goods
Trade in services
Income on investments
None of the above
Q.23
Type of security backed by mortgage cash flows and are packed by financial instruments is classified as
cash mortgage
securitized mortgage
financial mortgage
instrumental mortgage
Q.24
International Monetary Fund formal existence came into being in
12-05-44
27-07-44
27-12-45
27-09-45
Q.25
Type of market in which securities with less than one year maturity are traded is classified as
money market
capital market
transaction market
global market
Q.26
Risk stating assets are sold at low prices because of sudden surge in withdrawals of liabilities is classified as
payment risk
liquidity risk
income risk
balance risk
Q.27
In capital markets, major suppliers of trading instruments are
government and corporations
liquid corporations
instrumental corporations
manufacturing corporations
Q.28
In foreign financial markets, growth is represented by factors such as
savings in foreign countries
investment opportunities
accessible information
all of above
Q.29
Authority which intervenes directly or indirectly in foreign exchange markets by altering interest rates is considered as
centralized instruments
centralized stocks
central government
central corporations
Q.30
The primary component of the current account is the.
balance of trade
balance of money market flows
balance of capital market flows
unilateral transfers
Q.31
What is the role of IMF
It controls the budgets of national government
It acts as a forum for international economics
It Observes world exchange rates, balance of payments and multilateral payments
It seeks to promote free international trade
Q.32
The abbreviations SDR stands for
Special Drawing Rights
Specific Drawing Rights
Special Depository Rules
Specific Depository Rules
Q.33
Currency in which Eurobonds are denominated is decided by
buyers of bond
issuers of bonds
close market prices
open market prices
Q.34
Pegging the value of a currency can be done by
pegging to a major currency
pegging to a basket of currencies
pegging to SDR
any of the above
Q.35
When maturities of liabilities and assets are mismatched and risk incurred by financial intermediaries then this risk is classified as
interest rate risk
channel rate risk
economic risk
issuance risk
Q.36
Institutions classified as depository ones and have loans as their major assets are classified as
commercial banks
commercial mortgages
credit mortgages
credit derivative
Q.37
Major assets of commercial banks are
commercial loans
consumer loans
deposits
both a and c
Q.38
Bonds which are denominated in dollars and are issued in canters of London and Luxemburg are classified as
London bonds
Eurodollar bonds
central bonds
decentralize bonds
Q.39
Financial intermediaries offering savings plans to individuals and funds are exempted from taxation are considered as
trading funds
penalty funds
pension funds
global funds
Q.40
Financial instruments of public markets includes
transfer funds
bearer bonds
shares
bonds
Q.41
Markets in which transactions are done through computers and telephone without any specific location are classified as
past counter market
future counter market
over counter markets
capital counter market
Q.42
Based on interest rate parity, the larger the degree by which the foreign interest rate exceeds the UK interest rate, the.
larger will be the forward discount of the foreign currency
larger will be the forward premium of the foreign currency
smaller will be the forward premium of the foreign currency
smaller will be the forward discount of the foreign currency
Q.43
Type of structured market through which funds flow with help of financial instruments such as bonds and stocks is classified as
financial markets
non-financial markets
funds market
flow market
Q.44
Transfer of financial instruments from suppliers of funds to users of funds without any intermediary in between is classified as
global transfer
pension transfer
direct transfer
indirect transfer
Q.45
Services provided by financial institutions as providing financing to any specific sector of economy such as real estate business are classified as
business allocation
sector allocation
economic allocation
credit allocation
Q.46
______________ is (are income received by investors on foreign investments in financial assets securities
Portfolio income
Direct foreign income
Unilateral transfers
Factor income
Q.47
Names of foreign bonds are used to denote
country of premium
country of origin
country of selling
country of discount
Q.48
Face value of bond is $685 and call price of bond is $378 then value of call premium is
$307
$1,063
$2,063
$3,063
Q.49
Type of rating to which all credit rating agencies does not consider is classified as
split rating
sinking rating
automated rating
floating rating
Q.50
Exchange rate of foreign currency fluctuate day to day because of
demand and supply
increased maturity
decreased maturity
instrument availability
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