Top 250+ Solved International Finance MCQ Questions Answer
Q. _________ is market where foreign currencies are bought and sold.
a. Stock Market
b. Forex Market
c. Capital Market
d. Debt Market
Q. _________ theory states that the exchange rate between currencies of two countriesshould be equal to the ratio of the countries price levels.
a. IRP
b. PPP
c. Fisher`s
d. T Bills
Q. Money market instruments include all the following, except _____________
a. Commercial papers
b. T -Bills
c. Certificate of Deposit
d. Equity shares
Q. ________ theory states that exchange rate between two currencies is directly affectedby their interest rates.
a. IRP
b. PPP
c. Fisher`s
d. Home Foreign
Q. If formula I of Fishers effect is positive, Borrow ___________ , invest __________.
a. Foreign, Home
b. Foreign, Foreign
c. Home, Home
d. Home Foreign
Q. __________ is a standardized contract to exchange one currency for another at a specialdate in the future at a price (exchange rate) that is fixed on the purchase date.
a. Futures Contract
b. Options Contract
c. Swaps
d. Forward contract
Q. The _______ requires that an upfront margin to trade on an exchange.
a. Currency forwards
b. Currency options
c. Currency FTF`s
d. Currency Futures
Q. Which of the following is false ________
a. Futures contracts trade on a financial exchange
b. Futures contracts are more liquid than forward contracts
c. Futures contracts are marked to market
d. Futures contracts allow fewer delivery options than forward contracts
Q. Which of the following does the most to reduce default risk for futurescontracts_________
a. High liquidity
b. Flexible delivery arrangements
c. Marking to market
d. Credit checks for both buyers and sellers
Q. Foreign currency forward market is ___________
a. An over the counter unorganized market
b. Organized market without trading
c. Organized listed market
d. Unauthorized listed market
Q. Which of the following financial instruments is primarily used to transfer risk_____________
a. Bonds
b. Home Mortgages
c. Futures Contract
d. Stocks
Q. An option giving the buyer of the option the right but not the obligation to buy acurrency is _____________
a. Call option
b. Put option
c. Forward option
d. Future option