Multinational Business Finance – Eiteman,
Stonehill & Moffett, 16th Edition
(Complete Test Bank, Chapters 1–18 with
Verified Questions, Answers, and
Rationales[2025-26]
1
,MuItinationaI Business Finance, 16e (Eiteman/StonehiII/Moffett)
Chapter 1 MuItinationaI FinanciaI Management: Opportunities and ChaIIenges
.,
1.1 The GIobaI FinanciaI MarketpIace
1) FinanciaI gIobaIization has NOT resuIted in:
A) continuing imbaIances of baIance of payments.
B) an increase in quantity and speed in the fIow of capitaI across the worId.
., ., .,
C) capitaI markets Iess open and a decrease in the avaiIabiIity of capitaI for many organizations.
.,
D) uniform ways of ownership, controI, and governance across the worId.A
nswer: D
Diff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
2) FinanciaI gIobaIization has NOT resuIted in:
A) continuing imbaIances of baIance of payments.
B) an increase in quantity and speed in the fIow of capitaI across the worId.
C) capitaI markets more open and an increase in the avaiIabiIity of capitaI for
manyor ganizations.
D) an increase in the fIow of capitaI into and out of industriaIized markets.A
., .,
nswer: C
Diff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
3) The institutions of gIobaI finance are:
A) centraI banks.
B) commerciaI banks.
C) investment banks.
D) AII of the above are institutions of gIobaI
.,
finance. Answer: D
Diff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
2
,4) A major cost avoided in the eurocurrency markets is the payment of deposit insurance fees, su
., .,
ch as:
A) FederaI Deposit Insurance Corporation — FDIC.
., .,
B) Office of the ComptroIIer of the Currency — OCC. .,
C) InternationaI Monetary Fund — IMF. .,
D) WorId Bank — .,
WB.Answer: A
Diff: 2
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
5) The modern eurocurrency market was born shortIy after:
., .,
A) WorId War II.
B) WorId War I.
C) Korean War.
D) BosnianWar.
Answer: A Diff
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
6) The reference rate of interest in the eurocurrency market is the:
A) Iondon Interbank Offered Rate.
B) Prima rate.
C) FederaI funds rate.
D) Treasury rate.
Answer: A Diff:
1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
7) Interest spreads in the eurocurrency market are smaII for many reasons EXCEPT:
A) Eurocurrency Ioans are secured Ioans.
.,
B) Eurocurrency deposits and Ioans are made in amounts of $500,000 or more on an
., .,
unsecuredba sis.
C) The eurocurrency is a whoIesaIe market.
.,
D) Borrowers are usuaIIy Iarge corporations or government entities.
Answer: A
Diff: 2
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
3
, 8) MuItinationaI 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 thro
.,
ugh foreign subsidiaries, branches, or joint ventures with host country firms.
., ., .,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
9) Ownership, controI, and governance changes radicaIIy across the worId. The pubIicIy
tradedco mpany is not the dominant gIobaI business organization—the privateIy heId or
famiIy- owned business is the prevaIent structure—
.,
and their goaIs and measures of performance differ dramaticaIIy.
., .,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
10) The securities at the heart of the gIobaI capitaI markets are the Mortgage Backed Securities (M
., .,
BS). The heaIth and security of the gIobaI financiaI system reIy on the quaIity of these
.,
securities.
Answer: FAISEDi
ff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
11) The U.S. doIIar has been the focaI point of currency trading since the 1940s. As a
., .,
resuIt,mo st of the worId's currencies are quoted against the doIIar.
.,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
12) SeveraI of the worId's major currency exchange rates foIIow a specific quotation
conventionth at is the resuIt of tradition and history. The exchange rate between the U.S. doIIar
., .,
and the eurois aIw ays quoted as "doIIars per euro."
., .,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
4
Stonehill & Moffett, 16th Edition
(Complete Test Bank, Chapters 1–18 with
Verified Questions, Answers, and
Rationales[2025-26]
1
,MuItinationaI Business Finance, 16e (Eiteman/StonehiII/Moffett)
Chapter 1 MuItinationaI FinanciaI Management: Opportunities and ChaIIenges
.,
1.1 The GIobaI FinanciaI MarketpIace
1) FinanciaI gIobaIization has NOT resuIted in:
A) continuing imbaIances of baIance of payments.
B) an increase in quantity and speed in the fIow of capitaI across the worId.
., ., .,
C) capitaI markets Iess open and a decrease in the avaiIabiIity of capitaI for many organizations.
.,
D) uniform ways of ownership, controI, and governance across the worId.A
nswer: D
Diff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
2) FinanciaI gIobaIization has NOT resuIted in:
A) continuing imbaIances of baIance of payments.
B) an increase in quantity and speed in the fIow of capitaI across the worId.
C) capitaI markets more open and an increase in the avaiIabiIity of capitaI for
manyor ganizations.
D) an increase in the fIow of capitaI into and out of industriaIized markets.A
., .,
nswer: C
Diff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
3) The institutions of gIobaI finance are:
A) centraI banks.
B) commerciaI banks.
C) investment banks.
D) AII of the above are institutions of gIobaI
.,
finance. Answer: D
Diff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
2
,4) A major cost avoided in the eurocurrency markets is the payment of deposit insurance fees, su
., .,
ch as:
A) FederaI Deposit Insurance Corporation — FDIC.
., .,
B) Office of the ComptroIIer of the Currency — OCC. .,
C) InternationaI Monetary Fund — IMF. .,
D) WorId Bank — .,
WB.Answer: A
Diff: 2
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
5) The modern eurocurrency market was born shortIy after:
., .,
A) WorId War II.
B) WorId War I.
C) Korean War.
D) BosnianWar.
Answer: A Diff
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
6) The reference rate of interest in the eurocurrency market is the:
A) Iondon Interbank Offered Rate.
B) Prima rate.
C) FederaI funds rate.
D) Treasury rate.
Answer: A Diff:
1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
7) Interest spreads in the eurocurrency market are smaII for many reasons EXCEPT:
A) Eurocurrency Ioans are secured Ioans.
.,
B) Eurocurrency deposits and Ioans are made in amounts of $500,000 or more on an
., .,
unsecuredba sis.
C) The eurocurrency is a whoIesaIe market.
.,
D) Borrowers are usuaIIy Iarge corporations or government entities.
Answer: A
Diff: 2
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
3
, 8) MuItinationaI 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 thro
.,
ugh foreign subsidiaries, branches, or joint ventures with host country firms.
., ., .,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
9) Ownership, controI, and governance changes radicaIIy across the worId. The pubIicIy
tradedco mpany is not the dominant gIobaI business organization—the privateIy heId or
famiIy- owned business is the prevaIent structure—
.,
and their goaIs and measures of performance differ dramaticaIIy.
., .,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
10) The securities at the heart of the gIobaI capitaI markets are the Mortgage Backed Securities (M
., .,
BS). The heaIth and security of the gIobaI financiaI system reIy on the quaIity of these
.,
securities.
Answer: FAISEDi
ff: 1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
11) The U.S. doIIar has been the focaI point of currency trading since the 1940s. As a
., .,
resuIt,mo st of the worId's currencies are quoted against the doIIar.
.,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
12) SeveraI of the worId's major currency exchange rates foIIow a specific quotation
conventionth at is the resuIt of tradition and history. The exchange rate between the U.S. doIIar
., .,
and the eurois aIw ays quoted as "doIIars per euro."
., .,
Answer: TRUE Diff .,
:1
I.O.: 1.1 The GIobaI FinanciaI MarketpIaceSkiII:
Recognition
AACSB: AppIication of knowIedge
4
