Fundamentals of Corporate Finance Study Set 23

Quiz 21 :Options and Corporate Finance

Question Type
U.S.dollars deposited in a bank in Switzerland are called:
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D

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You would like to purchase a security that is issued by the British government.Which one of the following should you purchase?
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E

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The condition stating that the interest rate differential between two countries is equal to the percentage difference between the forward exchange rate and the spot exchange rate is called:
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E

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Which one of the following securities is used as a means of investing in a foreign stock that otherwise could not be traded in the United States?
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A large U.S.company has £500,000 in excess cash from its foreign operations.The company would like to exchange these funds for U.S.dollars.In which of the following markets can this exchange be arranged?
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Assume that $1 is equal to ¥98 and also equal to C$1.21.Based on this, you could say that C$1 is equal to: C$1(¥98/C$1.21) = ¥80.99.The exchange rate of C$1 = ¥80.99 is referred to as the:
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On Friday evening, Bank A loans Bank B Eurodollars that must be repaid the following Monday morning.Which one of the following is most likely the interest rate that will be charged on this loan?
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Which one of the following states that the expected percentage change in the exchange rate between two countries is equal to the difference in the countries' interest rates?
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A trader has just agreed to exchange $2 million U.S.dollars for$1.55 million Euros six months from today.This exchange is an example of a:
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George and Pat just made an agreement to exchange currencies based on today's exchange rate.Settlement will occur tomorrow.Which one of the following is the exchange rate that applies to this agreement?
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Trader A has agreed to give 100,000 U.S.dollars to Trader B in exchange for British pounds based on today's exchange rate of $1 = £0.62.The traders agree to settle this trade within two business day.What is this exchange called? Multiple Choice Answer: Tags Choose question tag Mr.Black has agreed to a currency exchange with Mr.White.The parties have agreed to exchange C$12,500 for $10,000 with the exchange occurring 4 months from now.This agreed-upon exchange rate is called the: Multiple Choice Answer: Tags Choose question tag International bonds issued in a single country and denominated in that country's currency are called: Multiple Choice Answer: Tags Choose question tag International bonds issued in multiple countries but denominated solely in the issuer's currency are called: Multiple Choice Answer: Tags Choose question tag Which one of the following supports the idea that real interest rates are equal across countries? Multiple Choice Answer: Tags Choose question tag Which one of the following is the risk that a firm faces when it opens a facility in a foreign country, given that the exchange rate between the firm's home country and this foreign country fluctuates over time? Multiple Choice Answer: Tags Choose question tag Which one of the following states that the current forward rate is an unbiased predictor of the future spot exchange rate? Multiple Choice Answer: Tags Choose question tag Assume that an item costs$100 in the U.S.and the exchange rate between the U.S.and Canada is: $1 = C$1.27.Which one of the following concepts supports the idea that the item that sells for $100 in the U.S.is currently selling in Canada for$127?
Multiple Choice
Party A has agreed to exchange $1 million U.S.dollars for$1.21 million Canadian dollars.What is this agreement called?