FIN 6420 CH 3 QUESTIONS WITH 100% CORRECT
ANSWERS.
Assume that $1 is equal to .85 Euros and 98 yen. The value of yen in euros is
a. .01
b. 118
c. 1.18
d. .0087 Answer - .0087
In general, stock markets allow for more governance and attract more investors
when they have all of the following except:
a. less stringent accounting requirements
b. more legal protection for shareholders
c. more enforcement of the laws
d. more voting rights for shareholders Answer - less stringent accounting
requirements
A cross exchange rate expresses the amount of one foreign currency per unit of
another foreign currency. T/F? Answer - TRUE
The bid/ask spread quoted on more liquid, heavily traded currencies are larger
than the spreads on less liquid, less traded currencies. T/F? Answer - FALSE
, Which of the following is NOT true about syndicated loans?
a. a borrower that receives a syndicated loan incurs various fees besides the
interest rate
b. the loans must be denominated in US dollars
c. the loans are provided by a group of banks to a borrower
d. all of these are true Answer - the loans must be denominated in US dollars
The bid quote is the price at which a bank offers to sell a currency. T/F? Answer
- FALSE
A Japanese yen is worth $.0080, and a Fijian dollar (F$) is worth $.5900. What
is the value of the yen in Fijian dollars (i.e., how many Fijian dollars do you
need to buy a yen)?
a. 125
b. 1.69
c 0.014
d. 73.75 Answer - 0.014
A syndicated 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
ANSWERS.
Assume that $1 is equal to .85 Euros and 98 yen. The value of yen in euros is
a. .01
b. 118
c. 1.18
d. .0087 Answer - .0087
In general, stock markets allow for more governance and attract more investors
when they have all of the following except:
a. less stringent accounting requirements
b. more legal protection for shareholders
c. more enforcement of the laws
d. more voting rights for shareholders Answer - less stringent accounting
requirements
A cross exchange rate expresses the amount of one foreign currency per unit of
another foreign currency. T/F? Answer - TRUE
The bid/ask spread quoted on more liquid, heavily traded currencies are larger
than the spreads on less liquid, less traded currencies. T/F? Answer - FALSE
, Which of the following is NOT true about syndicated loans?
a. a borrower that receives a syndicated loan incurs various fees besides the
interest rate
b. the loans must be denominated in US dollars
c. the loans are provided by a group of banks to a borrower
d. all of these are true Answer - the loans must be denominated in US dollars
The bid quote is the price at which a bank offers to sell a currency. T/F? Answer
- FALSE
A Japanese yen is worth $.0080, and a Fijian dollar (F$) is worth $.5900. What
is the value of the yen in Fijian dollars (i.e., how many Fijian dollars do you
need to buy a yen)?
a. 125
b. 1.69
c 0.014
d. 73.75 Answer - 0.014
A syndicated 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
