TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
TEST BANK for International Financial Management
K K K K K K
9th Edition by Cheol Eun, Bruce Resnick and Tuugi C
K K K K K K K K K
huluun. ISBN-13: 9781260013870
K K
TestKBank PageK1
, TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
MULTIPLEKCHOICEK-
ChooseKtheKoneKalternativeKthatKbestKcompletesKtheKstatementKorKanswersKtheKquestion.
K
1) WhatKmajorKdimensionKsetsKapartKinternationalKfinanceKfromKdomesticKfinance?
A) ForeignKexchangeKandKpoliticalKrisks
B) MarketKimperfections
C) ExpandedKopportunityKset
D) allKofKtheKoptions
2) AnKexample(s)KofKaKpoliticalKriskKis
A) expropriationKofKassets.
B) adverseKchangeKinKtaxKrules.
C) theKoppositionKpartyKbeingKelected.
D) bothKtheKexpropriationKofKassetsKandKadverseKchangesKinKtaxKrulesKareKcorrect.
3) ProductionKofKgoodsKandKservicesKhasKbecomeKglobalizedKtoKaKlargeKextentKasKaKresultKof
A) naturalKresourcesKbeingKdepletedKinKoneKcountryKafterKanother.
B) skilledKlaborKbeingKhighlyKmobile.
C) multinationalKcorporations'KeffortsKtoKsourceKinputsKandKlocateKproductionKanywher
eKwhereKcostsKareKlowerKandKprofitsKhigher.
D) commonKtastesKworldwideKforKtheKsameKgoodsKandKservices.
4) Recently,KfinancialKmarketsKhaveKbecomeKhighlyKintegrated.KThisKdevelopment
TestKBank PageK2
, TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
A) allowsKinvestorsKtoKdiversifyKtheirKportfoliosKinternationally.
B) allowsKminorityKinvestorsKtoKbuyKandKsellKstocks.
C) hasKincreasedKtheKcostKofKcapitalKforKfirms.
D) noneKofKtheKoptions
5) JapanKhasKexperiencedKlargeKtradeKsurpluses.KJapaneseKinvestorsKhaveKrespondedKtoKthisKby
A) liquidatingKtheirKpositionsKinKstocksKtoKbuyKdollar-denominatedKbonds.
B) investingKheavilyKinKU.S.KandKotherKforeignKfinancialKmarkets.
C) lobbyingKtheKU.S.KgovernmentKtoKdepreciateKitsKcurrency.
D) lobbyingKtheKJapaneseKgovernmentKtoKallowKtheKyenKtoKappreciate.
6) SupposeKyourKfirmKinvestsK$100,000KinKaKprojectKinKItaly.KAtKtheKtimeKtheKexchangeKrateKis
$1.25K=K€1.00.KOneKyearKlaterKtheKexchangeKrateKisKtheKsame,KbutKtheKItalianKgovernmentKh
asKexpropriatedKyourKfirm'sKassetsKpayingKonlyK€80,000KinKcompensation.KThisKisKanKexamp
leKof
A) exchangeKrateKrisk.
B) politicalKrisk.
C) marketKimperfections.
D)KnoneKofKtheKoptions,KsinceK$100,000K=K€80,000K×K$1.25/€1.00.
TestKBank PageK3
, TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
7) SupposeKyouKstartKwithK$100KandKbuyKstockKforK£50KwhenKtheKexchangeKrateKisK£1K=K$2.
OneKyearKlater,KtheKstockKrisesKtoK£60.KYouKareKhappyKwithKyourK20KpercentKreturnKonKtheKstock
K
,KbutKwhenKyouKsellKtheKstockKandKexchangeKyourK£60KforKdollars,KyouKonlyKgetK$45KsinceKtheKpo
undKhasKfallenKtoK£1K=K$0.75.KThisKlossKofKvalueKisKanKexampleKof
A) exchangeKrateKrisk.
B) politicalKrisk.
C) marketKimperfections.
D) weaknessKinKtheKdollar.
8) SupposeKthatKGreatKBritainKisKaKmajorKexportKmarketKforKyourKfirm,KaKU.S.-
basedKMNC.KIfKtheKBritishKpoundKdepreciatesKagainstKtheKU.S.Kdollar,
A) yourKfirmKwillKbeKableKtoKchargeKmoreKinKdollarKtermsKwhileKkeepingKpoundKprices
stable.
B) yourKfirmKmayKbeKpricedKoutKofKtheKU.K.Kmarket,KtoKtheKextentKthatKyourKdollarKcosts
stayKconstantKandKyourKpoundKpricesKwillKrise.
C) toKprotectKU.K.KmarketKshare,KyourKfirmKmayKhaveKtoKcutKtheKdollarKpriceKofKyourKgoo
dsKtoKkeepKtheKpoundKpriceKtheKsame.
D) yourKfirmKmayKbeKpricedKoutKofKtheKU.K.Kmarket,KtoKtheKextentKthatKyourKdollarKcos
tsKstayKconstantKandKyourKpoundKpricesKwillKrise,KandKtoKprotectKU.K.KmarketKshare,KyourKfirm
mayKhaveKtoKcutKtheKdollarKpriceKofKyourKgoodsKtoKkeepKtheKpoundKpriceKtheKsame.
K
9) SupposeKMexicoKisKaKmajorKexportKmarketKforKyourKU.S.-
basedKcompanyKandKtheKMexicanKpesoKappreciatesKdrasticallyKagainstKtheKU.S.Kdollar.KThisKmean
s
TestKBank PageK4
Chuluun.
TEST BANK for International Financial Management
K K K K K K
9th Edition by Cheol Eun, Bruce Resnick and Tuugi C
K K K K K K K K K
huluun. ISBN-13: 9781260013870
K K
TestKBank PageK1
, TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
MULTIPLEKCHOICEK-
ChooseKtheKoneKalternativeKthatKbestKcompletesKtheKstatementKorKanswersKtheKquestion.
K
1) WhatKmajorKdimensionKsetsKapartKinternationalKfinanceKfromKdomesticKfinance?
A) ForeignKexchangeKandKpoliticalKrisks
B) MarketKimperfections
C) ExpandedKopportunityKset
D) allKofKtheKoptions
2) AnKexample(s)KofKaKpoliticalKriskKis
A) expropriationKofKassets.
B) adverseKchangeKinKtaxKrules.
C) theKoppositionKpartyKbeingKelected.
D) bothKtheKexpropriationKofKassetsKandKadverseKchangesKinKtaxKrulesKareKcorrect.
3) ProductionKofKgoodsKandKservicesKhasKbecomeKglobalizedKtoKaKlargeKextentKasKaKresultKof
A) naturalKresourcesKbeingKdepletedKinKoneKcountryKafterKanother.
B) skilledKlaborKbeingKhighlyKmobile.
C) multinationalKcorporations'KeffortsKtoKsourceKinputsKandKlocateKproductionKanywher
eKwhereKcostsKareKlowerKandKprofitsKhigher.
D) commonKtastesKworldwideKforKtheKsameKgoodsKandKservices.
4) Recently,KfinancialKmarketsKhaveKbecomeKhighlyKintegrated.KThisKdevelopment
TestKBank PageK2
, TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
A) allowsKinvestorsKtoKdiversifyKtheirKportfoliosKinternationally.
B) allowsKminorityKinvestorsKtoKbuyKandKsellKstocks.
C) hasKincreasedKtheKcostKofKcapitalKforKfirms.
D) noneKofKtheKoptions
5) JapanKhasKexperiencedKlargeKtradeKsurpluses.KJapaneseKinvestorsKhaveKrespondedKtoKthisKby
A) liquidatingKtheirKpositionsKinKstocksKtoKbuyKdollar-denominatedKbonds.
B) investingKheavilyKinKU.S.KandKotherKforeignKfinancialKmarkets.
C) lobbyingKtheKU.S.KgovernmentKtoKdepreciateKitsKcurrency.
D) lobbyingKtheKJapaneseKgovernmentKtoKallowKtheKyenKtoKappreciate.
6) SupposeKyourKfirmKinvestsK$100,000KinKaKprojectKinKItaly.KAtKtheKtimeKtheKexchangeKrateKis
$1.25K=K€1.00.KOneKyearKlaterKtheKexchangeKrateKisKtheKsame,KbutKtheKItalianKgovernmentKh
asKexpropriatedKyourKfirm'sKassetsKpayingKonlyK€80,000KinKcompensation.KThisKisKanKexamp
leKof
A) exchangeKrateKrisk.
B) politicalKrisk.
C) marketKimperfections.
D)KnoneKofKtheKoptions,KsinceK$100,000K=K€80,000K×K$1.25/€1.00.
TestKBank PageK3
, TESTKBANKKforKInternationalKFinancialKManagementK9thKEditionKbyKCheolKEun,KBruceKResnickKandKTuugi
Chuluun.
7) SupposeKyouKstartKwithK$100KandKbuyKstockKforK£50KwhenKtheKexchangeKrateKisK£1K=K$2.
OneKyearKlater,KtheKstockKrisesKtoK£60.KYouKareKhappyKwithKyourK20KpercentKreturnKonKtheKstock
K
,KbutKwhenKyouKsellKtheKstockKandKexchangeKyourK£60KforKdollars,KyouKonlyKgetK$45KsinceKtheKpo
undKhasKfallenKtoK£1K=K$0.75.KThisKlossKofKvalueKisKanKexampleKof
A) exchangeKrateKrisk.
B) politicalKrisk.
C) marketKimperfections.
D) weaknessKinKtheKdollar.
8) SupposeKthatKGreatKBritainKisKaKmajorKexportKmarketKforKyourKfirm,KaKU.S.-
basedKMNC.KIfKtheKBritishKpoundKdepreciatesKagainstKtheKU.S.Kdollar,
A) yourKfirmKwillKbeKableKtoKchargeKmoreKinKdollarKtermsKwhileKkeepingKpoundKprices
stable.
B) yourKfirmKmayKbeKpricedKoutKofKtheKU.K.Kmarket,KtoKtheKextentKthatKyourKdollarKcosts
stayKconstantKandKyourKpoundKpricesKwillKrise.
C) toKprotectKU.K.KmarketKshare,KyourKfirmKmayKhaveKtoKcutKtheKdollarKpriceKofKyourKgoo
dsKtoKkeepKtheKpoundKpriceKtheKsame.
D) yourKfirmKmayKbeKpricedKoutKofKtheKU.K.Kmarket,KtoKtheKextentKthatKyourKdollarKcos
tsKstayKconstantKandKyourKpoundKpricesKwillKrise,KandKtoKprotectKU.K.KmarketKshare,KyourKfirm
mayKhaveKtoKcutKtheKdollarKpriceKofKyourKgoodsKtoKkeepKtheKpoundKpriceKtheKsame.
K
9) SupposeKMexicoKisKaKmajorKexportKmarketKforKyourKU.S.-
basedKcompanyKandKtheKMexicanKpesoKappreciatesKdrasticallyKagainstKtheKU.S.Kdollar.KThisKmean
s
TestKBank PageK4
