BFIN Test 2025 - Questions with Correct Verified
Answers
1) The balance of payments as applied to a course in international finance may be defined
as
A) the amount still owed by an exporting firm after making an initial down payment.
B) the amount still owed by governments to the International Monetary Fund.
C) the measurement of all international economic transactions between the residents of a
country and foreign residents.
D) the amount of a country's merchandise trade deficit or surplus.
Answer: C
Diff: 1
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Conceptual
2) Balance of payment (BOP) data may be important for any of the following reasons
A) BOP data helps to forecast a country's market potential, especially in the short run.
B) The BOP is an important indicator of a country's foreign exchange rate.
C) Changes in a country's BOP may signal a change in controls over payment of dividends
and interest.
D) All of the above.
Answer: D
Diff: 1
,Topic: 3.1 Typical Balance of Payments Transactions
Skill: Conceptual
3) Which of the following is NOT an item to be considered in BOP calculations?
A) A foreign resident purchases a U.S. Treasury Bill.
B) A U.S.-based firm manages the development of an oil field in Kazakhstan.
C) A consumer buys a VCR made in Korea from a Wal-Mart store.
D) A U.S. citizen living in Minnesota travels to Winnipeg, Canada and buys a case of
LaBatt's Canadian beer.
Answer: C
Diff: 1
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Conceptual
, 4) A country experiencing a serious BOP ________ is more likely to ________ exports than
otherwise.
A) surplus; contract
B) deficit; contract
C) deficit; expand
D) none of the above
Answer: A
Diff: 2
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Analytical
5) Expenditures by U.S. tourists in foreign countries for foreign goods or services are
factored into BOP calculations.
Answer: TRUE
Diff: 1
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Recognition
6) Which of the following would NOT be considered a typical BOP transaction?
A) Toyota U.S.A. is a U.S. distributor of automobiles manufactured in Japan by its parent
company.
B) The U.S. subsidiary of European financial giant, Credit Suisse, pays dividends to its
parent in Zurich.
Answers
1) The balance of payments as applied to a course in international finance may be defined
as
A) the amount still owed by an exporting firm after making an initial down payment.
B) the amount still owed by governments to the International Monetary Fund.
C) the measurement of all international economic transactions between the residents of a
country and foreign residents.
D) the amount of a country's merchandise trade deficit or surplus.
Answer: C
Diff: 1
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Conceptual
2) Balance of payment (BOP) data may be important for any of the following reasons
A) BOP data helps to forecast a country's market potential, especially in the short run.
B) The BOP is an important indicator of a country's foreign exchange rate.
C) Changes in a country's BOP may signal a change in controls over payment of dividends
and interest.
D) All of the above.
Answer: D
Diff: 1
,Topic: 3.1 Typical Balance of Payments Transactions
Skill: Conceptual
3) Which of the following is NOT an item to be considered in BOP calculations?
A) A foreign resident purchases a U.S. Treasury Bill.
B) A U.S.-based firm manages the development of an oil field in Kazakhstan.
C) A consumer buys a VCR made in Korea from a Wal-Mart store.
D) A U.S. citizen living in Minnesota travels to Winnipeg, Canada and buys a case of
LaBatt's Canadian beer.
Answer: C
Diff: 1
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Conceptual
, 4) A country experiencing a serious BOP ________ is more likely to ________ exports than
otherwise.
A) surplus; contract
B) deficit; contract
C) deficit; expand
D) none of the above
Answer: A
Diff: 2
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Analytical
5) Expenditures by U.S. tourists in foreign countries for foreign goods or services are
factored into BOP calculations.
Answer: TRUE
Diff: 1
Topic: 3.1 Typical Balance of Payments Transactions
Skill: Recognition
6) Which of the following would NOT be considered a typical BOP transaction?
A) Toyota U.S.A. is a U.S. distributor of automobiles manufactured in Japan by its parent
company.
B) The U.S. subsidiary of European financial giant, Credit Suisse, pays dividends to its
parent in Zurich.
