https://browsegrades.net/singlePaper/416756/testbank-an
,Multinational-Business-Finance,-16e-(Eiteman/Stonehill/Moffett)
Chapter-1 Multinational-Financial-Management:-Opportunities-and-Challenges
1.1 The-Global-Financial-Marketplace
1) Financial-globalization-has-NOT-resulted-in:
A) continuing-imbalances-of-balance-of-payments.
B) an-increase-in-quantity-and-speed-in-the-flow-of-capital-across-the-world.
C) capital-markets-less-open-and-a-decrease-in-the-availability-of-capital-for-many-organizations.
D) uniform-ways-of-ownership,-control,-and-governance-across-the-
world.-Answer:- D
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
2) Financial-globalization-has-NOT-resulted-in:
A) continuing-imbalances-of-balance-of-payments.
B) an-increase-in-quantity-and-speed-in-the-flow-of-capital-across-the-world.
C) capital-markets-more-open-and-an-increase-in-the-availability-of-capital-for-
many-organizations.
D) an-increase-in-the-flow-of-capital-into-and-out-of-industrialized-
markets.-Answer:- C
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
3) The-institutions-of-global-finance-are:
A) central-banks.
B) commercial-banks.
C) investment-banks.
D) All-of-the-above-are-institutions-of-global-
finance.-Answer:- D
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
1
Copyright-©-2026-Pearson-Education,-
Inc.
,4) A-major-cost-avoided-in-the-eurocurrency-markets-is-the-payment-of-deposit-insurance-
fees,-such-as:
A) Federal-Deposit-Insurance-Corporation-—-FDIC.
B) Office-of-the-Comptroller-of-the-Currency-—-OCC.
C) International-Monetary-Fund-—-IMF.
D) World-Bank-—-
WB.-Answer:- A
Diff:-2
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
5) The-modern-eurocurrency-market-was-born-shortly-after:
A) World-War-II.
B) World-War-I.
C) Korean-War.
D) Bosnian-
War.-Answer:-
A- Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
6) The-reference-rate-of-interest-in-the-eurocurrency-market-is-the:
A) London-Interbank-Offered-Rate.
B) Prima-rate.
C) Federal-funds-rate.
D) Treasury-
rate.-Answer:-
A- Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
7) Interest-spreads-in-the-eurocurrency-market-are-small-for-many-reasons-EXCEPT:
A) Eurocurrency-loans-are-secured-loans.
B) Eurocurrency-deposits-and-loans-are-made-in-amounts-of-$500,000-or-more-on-an-
unsecured-basis.
C) The-eurocurrency-is-a-wholesale-market.
D) Borrowers-are-usually-large-corporations-or-government-
entities.-Answer:- A
Diff:-2
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
2
Copyright-©-2026-Pearson-Education,-
Inc.
, 8) Multinational-enterprises-(MNEs)-are-firms,-both-for-profit-companies-and-not-for-profit-
organizations,-that-have-operations-in-more-than-one-country,-and-conduct-their-business-
through-foreign-subsidiaries,-branches,-or-joint-ventures-with-host-country-firms.
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
9) Ownership,-control,-and-governance-changes-radically-across-the-world.-The-publicly-
traded-company-is-not-the-dominant-global-business-organization—the-privately-held-or-
family-owned-business-is-the-prevalent-structure—and-their-goals-and-measures-of-
performance-differ-dramatically.
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
10) The-securities-at-the-heart-of-the-global-capital-markets-are-the-Mortgage-Backed-
Securities-(MBS).-The-health-and-security-of-the-global-financial-system-rely-on-the-quality-
of-these-securities.
Answer:- FALSE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
11) The-U.S.-dollar-has-been-the-focal-point-of-currency-trading-since-the-1940s.-As-a-
result,-most-of-the-world's-currencies-are-quoted-against-the-dollar.
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
12) Several-of-the-world's-major-currency-exchange-rates-follow-a-specific-quotation-
convention-that-is-the-result-of-tradition-and-history.-The-exchange-rate-between-the-U.S.-dollar-
and-the-euro-is-always-quoted-as-"dollars-per-euro."
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
3
Copyright-©-2026-Pearson-Education,-
Inc.
,Multinational-Business-Finance,-16e-(Eiteman/Stonehill/Moffett)
Chapter-1 Multinational-Financial-Management:-Opportunities-and-Challenges
1.1 The-Global-Financial-Marketplace
1) Financial-globalization-has-NOT-resulted-in:
A) continuing-imbalances-of-balance-of-payments.
B) an-increase-in-quantity-and-speed-in-the-flow-of-capital-across-the-world.
C) capital-markets-less-open-and-a-decrease-in-the-availability-of-capital-for-many-organizations.
D) uniform-ways-of-ownership,-control,-and-governance-across-the-
world.-Answer:- D
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
2) Financial-globalization-has-NOT-resulted-in:
A) continuing-imbalances-of-balance-of-payments.
B) an-increase-in-quantity-and-speed-in-the-flow-of-capital-across-the-world.
C) capital-markets-more-open-and-an-increase-in-the-availability-of-capital-for-
many-organizations.
D) an-increase-in-the-flow-of-capital-into-and-out-of-industrialized-
markets.-Answer:- C
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
3) The-institutions-of-global-finance-are:
A) central-banks.
B) commercial-banks.
C) investment-banks.
D) All-of-the-above-are-institutions-of-global-
finance.-Answer:- D
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
1
Copyright-©-2026-Pearson-Education,-
Inc.
,4) A-major-cost-avoided-in-the-eurocurrency-markets-is-the-payment-of-deposit-insurance-
fees,-such-as:
A) Federal-Deposit-Insurance-Corporation-—-FDIC.
B) Office-of-the-Comptroller-of-the-Currency-—-OCC.
C) International-Monetary-Fund-—-IMF.
D) World-Bank-—-
WB.-Answer:- A
Diff:-2
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
5) The-modern-eurocurrency-market-was-born-shortly-after:
A) World-War-II.
B) World-War-I.
C) Korean-War.
D) Bosnian-
War.-Answer:-
A- Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
6) The-reference-rate-of-interest-in-the-eurocurrency-market-is-the:
A) London-Interbank-Offered-Rate.
B) Prima-rate.
C) Federal-funds-rate.
D) Treasury-
rate.-Answer:-
A- Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
7) Interest-spreads-in-the-eurocurrency-market-are-small-for-many-reasons-EXCEPT:
A) Eurocurrency-loans-are-secured-loans.
B) Eurocurrency-deposits-and-loans-are-made-in-amounts-of-$500,000-or-more-on-an-
unsecured-basis.
C) The-eurocurrency-is-a-wholesale-market.
D) Borrowers-are-usually-large-corporations-or-government-
entities.-Answer:- A
Diff:-2
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
2
Copyright-©-2026-Pearson-Education,-
Inc.
, 8) Multinational-enterprises-(MNEs)-are-firms,-both-for-profit-companies-and-not-for-profit-
organizations,-that-have-operations-in-more-than-one-country,-and-conduct-their-business-
through-foreign-subsidiaries,-branches,-or-joint-ventures-with-host-country-firms.
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
9) Ownership,-control,-and-governance-changes-radically-across-the-world.-The-publicly-
traded-company-is-not-the-dominant-global-business-organization—the-privately-held-or-
family-owned-business-is-the-prevalent-structure—and-their-goals-and-measures-of-
performance-differ-dramatically.
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
10) The-securities-at-the-heart-of-the-global-capital-markets-are-the-Mortgage-Backed-
Securities-(MBS).-The-health-and-security-of-the-global-financial-system-rely-on-the-quality-
of-these-securities.
Answer:- FALSE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
11) The-U.S.-dollar-has-been-the-focal-point-of-currency-trading-since-the-1940s.-As-a-
result,-most-of-the-world's-currencies-are-quoted-against-the-dollar.
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
12) Several-of-the-world's-major-currency-exchange-rates-follow-a-specific-quotation-
convention-that-is-the-result-of-tradition-and-history.-The-exchange-rate-between-the-U.S.-dollar-
and-the-euro-is-always-quoted-as-"dollars-per-euro."
Answer:- TRUE-
Diff:-1
L.O.:- 1.1-The-Global-Financial-Marketplace-
Skill:- Recognition
AACSB:- - Application-of-knowledge
3
Copyright-©-2026-Pearson-Education,-
Inc.
