Test Bank for Multinational Business Finance 16th Edition By (Eiteman/Stonehill/Moffett), ISBN: 9780137496013, All 18 Chapters Covered, Verified Latest Edition

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Multinational Business Finance, 16e (Eiteman/Stonehill/Moffett)
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Chapter 1 Multinational Financial Management: Opportunities and Challenges
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1.1 The Global Financial Marketplace
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1) Financial globalization has NOT resulted in:
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A) continuing imbalances of balance of payments.
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B) an increase in quantity and speed in the flow of capital across the world.
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C) capital markets less open and a decrease in the availability of capital for many
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organizations.
D) uniform ways of ownership, control, and governance across the
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world.Answer: D
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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2) Financial globalization has NOT resulted in:
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A) continuing imbalances of balance of payments.
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B) an increase in quantity and speed in the flow of capital across the world.
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C) capital markets more open and an increase in the availability of capital for
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manyorganizations.
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D) an increase in the flow of capital into and out of industrialized
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markets.Answer: C
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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3) The institutions of global finance are:
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A) central banks. ml


B) commercial banks. ml


C) investment banks. ml


D) All of the above are institutions of global
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finance.Answer: D
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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1
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Inc.

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4) A major cost avoided in the eurocurrency markets is the payment of deposit
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insurance fees,such as: ml m
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A) Federal Deposit Insurance Corporation — FDIC.
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B) Office of the Comptroller of the Currency — OCC.
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C) International Monetary Fund — IMF. ml ml ml ml


D) World Bank — ml ml ml


WB.Answer: A
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Diff: 2ml


L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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5) The modern eurocurrency market was born shortly after:
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A) World War II. ml ml


B) World War I. ml ml


C) Korean War. ml


D) Bosnian ml


War.Answer:
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A Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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6) The reference rate of interest in the eurocurrency market is the:
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A) London Interbank Offered Rate. ml ml ml


B) Prima rate. ml


C) Federal funds rate. ml ml


D) Treasury ml


rate.Answer:
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A Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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7) Interest spreads in the eurocurrency market are small for many reasons EXCEPT:
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A) Eurocurrency loans are secured loans. ml ml ml ml


B) Eurocurrency deposits and loans are made in amounts of $500,000 or more on an
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unsecuredbasis. m
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C) The eurocurrency is a wholesale market.
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D) Borrowers are usually large corporations or government
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entities.Answer: A m
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Diff: 2ml


L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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2
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Inc.

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8) Multinational enterprises (MNEs) are firms, both for-profit companies and not-for-profit
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organizations, that have operations in more than one country, and conduct their business
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throughforeign subsidiaries, branches, or joint ventures with host country firms.
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Answer: TRUE ml m
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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9) Ownership, control, and governance changes radically across the world. The publicly
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tradedcompany is not the dominant global business organization—the privately held or
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family-ownedbusiness is the prevalent structure—and their goals and measures of
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performance differ dramatically. ml ml


Answer: TRUE ml m
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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10) The securities at the heart of the global capital markets are the Mortgage Backed
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Securities(MBS). The health and security of the global financial system rely on the
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quality of these securities.
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Answer: FALSE ml m
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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11) The U.S. dollar has been the focal point of currency trading since the 1940s. As
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a result,most of the world's currencies are quoted against the dollar.
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Answer: TRUE ml m
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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12) Several of the world's major currency exchange rates follow a specific quotation
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convention that is the result of tradition and history. The exchange rate between the U.S.
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dollar and the eurois always quoted as "dollars per euro."
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Answer: TRUE ml m
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Diff: 1
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L.O.: 1.1 The Global Financial Marketplace
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Skill: Recognition
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AACSB: Application of knowledge
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3
Copyright © 2023 Pearson Education,
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Inc.