chapter3internationalfinancialmarkets练习答案+详解
Chapter 3 International Financial Markets
1. Assume that a bank's bid rate on Swiss francs is $.45 and its ask rate is $.47. Its bid-ask percentage spread is:
A) about %.
B) about %.
C) about %.
D) about %.
ANSWER: B
ask rate
SOLUTION: Bid-ask percentage spread = ($.47 - $.45)/$.47 = %
2. Assume that a bank's bid rate on Japanese yen is $.0041 and its ask rate is $.004
3. Its
bid-ask percentage spread is:
A) about %.
B) about %.
C) about %.
D) about %.
ANSWER: C
SOLUTION: Bid-ask percentage spread = ($.0043 - $.0041)/$.0043 = %
3. The bid/ask spread for small retail transactions is commonly in the range of ______ percent; the bid/ask spread for wholesale transactions is commonly in the range of ______ percent.
A) 3 to 7; .01 to .03
B) 2 to 5; .05 to .10
C) 10 to 15; .01 to .03
D) 1 to 2; .05 to .07
ANSWER: A
4. _______is not a factor that affects the bid/ask spread.
A) Order costs
B) Inventory costs
C) Volume
D) All of the above factors affect the bid/ask spread
ANSWER: D
5. The forward rate is the exchange rate used for immediate exchange of currencies.
A) true.
B) false.
ANSWER: B
6. The ask quote is the price for which a bank offers to sell a currency.
A) true.
B) false.
ANSWER: A
7. According to the text, the forward rate is commonly used for:
A) hedging.
B) Eurocurrency transactions.
C) Eurocredit transactions.
D) Eurobond transactions.
ANSWER: A
8. If a U.S. firm desires to avoid the risk from exchange rate fluctuations, and it is receiving
100,000 in 90 days, it could:
A) obtain a 90-day forward purchase contract on euros.
B) obtain a 90-day forward sale contract on euros.
C) purchase euros 90 days from now at the spot rate.
D) sell euros 90 days from now at the spot rate.
ANSWER: B
9. If a U.S. firm desires to avoid the risk from exchange rate fluctuations, and it will need
C$200,000 in 90 days to make payment on imports from Canada, it could:
A) obtain a 90-day forward purchase contract on Canadian dollars.
B) obtain a 90-day forward sale contract on Canadian dollars.
C) purchase Canadian dollars 90 days from now at the spot rate.
D) sell Canadian dollars 90 days from now at the spot rate.
ANSWER: A
10. Assume the Canadian dollar is equal to $.88 and the Peruvian Sol is equal to $.35. The
value of the Peruvian Sol in Canadian dollars is:
A) about .3621 Canadian dollars.
B) about .3977 Canadian dollars.
C) about Canadian dollars.
D) about Canadian dollars.
ANSWER: B
SOLUTION: $.35/$.88 = .3977
11. Which of the following is not true with respect to spot market liquidity?现货市场流动性
A) The more willing buyers and sellers there are, the more liquid a market is.
B) The spot markets for heavily traded currencies such as the Japanese yen are very liquid.
C) A currency's liquidity affects the ease with which an MNC can obtain or sell that currency.
D) If a currency is illiquid, an MNC is typically able to quickly purchase that currency at a reasonable exchange rate.
ANSWER: D
12. Forward markets for currencies of developing countries are:
A) prohibited.
B) less liquid than markets for developed countries.
C) more liquid than markets for developed countries.
D) only available for use by government agencies.
发展中国家现货市场流动性较低
ANSWER: B
13. A forward contract can be used to lock in the __________ of a specified currency for a
future point in time.
A) purchase price
B) sale price
C) A or B
D) none of the above
ANSWER: C
14. The forward market:
A) for euros is very illiquid.
B) for Eastern European countries is very liquid.
C) does not exist for some currencies.
D) none of the above
ANSWER: C
15. _______ is not a bank characteristic important to customers in need of foreign exchange.
A) Quote competitiveness
B) Speed of execution
C) Forecasting advice
D) Advice about current market conditions
E) All of the above are important bank characteristics to customers in need of foreign exchange.
ANSWER: E
16. The Basel II accord would:
A) replace the Basel Accord.
B) reduce the amount of capital banks are required to hold.
C) require banks to take more risks and to document their risk.
D) correct some inconsistencies that still exist. Operation risk
ANSWER: D
17. The international money market primarily concentrates on:
A) short-term lending (one year or less). IMM短期借款
B) medium-term lending.
C) long-term lending.
D) placing bonds with investors.
E) placing newly issued stock in foreign markets.
ANSWER: A
18. The international credit market primarily concentrates on:
A) short-term lending (less than one year).
B) medium-term lending.
C) long-term lending. 欧洲信用贷款市场
D) providing an exchange of foreign currencies for firms who need them.
E) placing newly issued stock in foreign markets.
ANSWER: B
19. The main participants in the international money market are:
A) consumers.
B) small firms.
C) large corporations.
D) small European firms needing European currencies for international trade.
ANSWER: C
20. LIBOR is: 同业拆借利率
A) the interest rate commonly charged for loans between banks.
B) the average inflation rate in European countries.
C) the maximum loan rate ceiling on loans in the international money market.
D) the maximum deposit rate ceiling on deposits in the international money market.
E) the maximum interest rate offered on bonds that are issued in London. ANSWER: A
21. A syndicated Eurocredit loan:
A) represents a loan by a single bank to a syndicate of corporations.
B) represents a loan by a single bank to a syndicate of country governments.
C) represents a direct loan by a syndicate of oil-producing exporters to a less developed
country.
D) represents a loan by a group of banks to a borrower.
E) A and B
ANSWER: D
22. The international money market is primarily served by:
A) the governments of European countries, which directly intervene in foreign currency
markets.
B) government agencies such as the International Monetary Fund that enhance development of countries.
C) several large banks that accept deposits and provide loans in various currencies.
D) small banks that convert foreign currency for tourists and business visitors. ANSWER: C