TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
TEST gBANK gfor gInternational gFinancial
Managementg9th gEdition gby gCheol gEun, gBruce
g
g Resnick gand gTuugi gChuluun. gISBN-13:
g 9781260013870
Test Page g
gBank 1
, TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
MULTIPLE gCHOICE g- gChoose gthe gone galternative gthat gbest gcompletes gthe
gstatement gorganswers gthe gquestion.
1) What gmajor gdimension gsets gapart ginternational gfinance gfrom gdomestic gfinance?
A) Foreign gexchange gand gpolitical grisks
B) Market gimperfections
C) Expanded gopportunity gset
D) all gof gthe goptions
2) An gexample(s) gof ga gpolitical grisk gis
A) expropriation gof gassets.
B) adverse gchange gin gtax grules.
C) the gopposition gparty gbeing gelected.
D) both gthe gexpropriation gof gassets gand gadverse gchanges gin gtax grules gare gcorrect.
3) Production gof ggoods gand gservices ghas gbecome gglobalized gto ga glarge gextent gas ga
gresult gof
A) natural gresources gbeing gdepleted gin gone gcountry gafter ganother.
B) skilled glabor gbeing ghighly gmobile.
C) multinational gcorporations' gefforts gto gsource ginputs gand glocate gproduction
ganywheregwhere gcosts gare glower gand gprofits ghigher.
D) common gtastes gworldwide gfor gthe gsame ggoods gand gservices.
4) Recently, gfinancial gmarkets ghave gbecome ghighly gintegrated. gThis gdevelopment
Test Page g
gBank 2
, TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
A) allows ginvestors gto gdiversify gtheir gportfolios ginternationally.
B) allows gminority ginvestors gto gbuy gand gsell gstocks.
C) has gincreased gthe gcost gof gcapital gfor gfirms.
D) none gof gthe goptions
5) Japan ghas gexperienced glarge gtrade gsurpluses. gJapanese ginvestors ghave gresponded gto
gthis gby
A) liquidating gtheir gpositions gin gstocks gto gbuy gdollar-denominated gbonds.
B) investing gheavily gin gU.S. gand gother gforeign gfinancial gmarkets.
C) lobbying gthe gU.S. ggovernment gto gdepreciate gits gcurrency.
D) lobbying gthe gJapanese ggovernment gto gallow gthe gyen gto gappreciate.
6) Suppose gyour gfirm ginvests g$100,000 gin ga gproject gin gItaly. gAt gthe gtime gthe gexchange
grate gis
$1.25 g= g€1.00. gOne gyear glater gthe gexchange grate gis gthe gsame, gbut gthe gItalian
ggovernment ghas gexpropriated gyour gfirm's gassets gpaying gonly g€80,000 gin
gcompensation. gThis gis gan gexample gof
A) exchange grate grisk.
B) political grisk.
C) market gimperfections.
D) gnone gof gthe goptions, gsince g$100,000 g= g€80,000 g× g$1.25/€1.00.
Test Page g
gBank 3
, TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
7) Suppose gyou gstart gwith g$100 gand gbuy gstock gfor g£50 gwhen gthe gexchange grate gis
g£1 g= g$2. gOne gyear glater, gthe gstock grises gto g£60. gYou gare ghappy gwith gyour g20 gpercent
greturn gon gthe gstock, gbut gwhen gyou gsell gthe gstock gand gexchange gyour g£60 gfor gdollars,
gyou gonly gget g$45 gsince gthe gpoundghas gfallen gto g£1 g= g$0.75. gThis gloss gof gvalue gis gan
gexample gof
A) exchange grate grisk.
B) political grisk.
C) market gimperfections.
D) weakness gin gthe gdollar.
8) Suppose gthat gGreat gBritain gis ga gmajor gexport gmarket gfor gyour gfirm, ga gU.S.-based
gMNC. gIfgthe gBritish gpound gdepreciates gagainst gthe gU.S. gdollar,
A) your gfirm gwill gbe gable gto gcharge gmore gin gdollar gterms gwhile gkeeping gpound
gprices
stable.
B) your gfirm gmay gbe gpriced gout gof gthe gU.K. gmarket, gto gthe gextent gthat gyour gdollar
gcosts
stay gconstant gand gyour gpound gprices gwill grise.
C) to gprotect gU.K. gmarket gshare, gyour gfirm gmay ghave gto gcut gthe gdollar gprice gof
gyour ggoodsgto gkeep gthe gpound gprice gthe gsame.
D) your gfirm gmay gbe gpriced gout gof gthe gU.K. gmarket, gto gthe gextent gthat gyour
gdollar gcosts gstay gconstant gand gyour gpound gprices gwill grise, gand gto gprotect gU.K.
gmarket gshare, gyour gfirm gmayghave gto gcut gthe gdollar gprice gof gyour ggoods gto gkeep gthe
gpound gprice gthe gsame.
9) Suppose gMexico gis ga gmajor gexport gmarket gfor gyour gU.S.-based gcompany gand gthe
Test Page g
gBank 4
gand gTuugi
Chuluun.
TEST gBANK gfor gInternational gFinancial
Managementg9th gEdition gby gCheol gEun, gBruce
g
g Resnick gand gTuugi gChuluun. gISBN-13:
g 9781260013870
Test Page g
gBank 1
, TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
MULTIPLE gCHOICE g- gChoose gthe gone galternative gthat gbest gcompletes gthe
gstatement gorganswers gthe gquestion.
1) What gmajor gdimension gsets gapart ginternational gfinance gfrom gdomestic gfinance?
A) Foreign gexchange gand gpolitical grisks
B) Market gimperfections
C) Expanded gopportunity gset
D) all gof gthe goptions
2) An gexample(s) gof ga gpolitical grisk gis
A) expropriation gof gassets.
B) adverse gchange gin gtax grules.
C) the gopposition gparty gbeing gelected.
D) both gthe gexpropriation gof gassets gand gadverse gchanges gin gtax grules gare gcorrect.
3) Production gof ggoods gand gservices ghas gbecome gglobalized gto ga glarge gextent gas ga
gresult gof
A) natural gresources gbeing gdepleted gin gone gcountry gafter ganother.
B) skilled glabor gbeing ghighly gmobile.
C) multinational gcorporations' gefforts gto gsource ginputs gand glocate gproduction
ganywheregwhere gcosts gare glower gand gprofits ghigher.
D) common gtastes gworldwide gfor gthe gsame ggoods gand gservices.
4) Recently, gfinancial gmarkets ghave gbecome ghighly gintegrated. gThis gdevelopment
Test Page g
gBank 2
, TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
A) allows ginvestors gto gdiversify gtheir gportfolios ginternationally.
B) allows gminority ginvestors gto gbuy gand gsell gstocks.
C) has gincreased gthe gcost gof gcapital gfor gfirms.
D) none gof gthe goptions
5) Japan ghas gexperienced glarge gtrade gsurpluses. gJapanese ginvestors ghave gresponded gto
gthis gby
A) liquidating gtheir gpositions gin gstocks gto gbuy gdollar-denominated gbonds.
B) investing gheavily gin gU.S. gand gother gforeign gfinancial gmarkets.
C) lobbying gthe gU.S. ggovernment gto gdepreciate gits gcurrency.
D) lobbying gthe gJapanese ggovernment gto gallow gthe gyen gto gappreciate.
6) Suppose gyour gfirm ginvests g$100,000 gin ga gproject gin gItaly. gAt gthe gtime gthe gexchange
grate gis
$1.25 g= g€1.00. gOne gyear glater gthe gexchange grate gis gthe gsame, gbut gthe gItalian
ggovernment ghas gexpropriated gyour gfirm's gassets gpaying gonly g€80,000 gin
gcompensation. gThis gis gan gexample gof
A) exchange grate grisk.
B) political grisk.
C) market gimperfections.
D) gnone gof gthe goptions, gsince g$100,000 g= g€80,000 g× g$1.25/€1.00.
Test Page g
gBank 3
, TEST gBANK gfor gInternational gFinancial gManagement g9th gEdition gby gCheol gEun, gBruce gResnick
gand gTuugi
Chuluun.
7) Suppose gyou gstart gwith g$100 gand gbuy gstock gfor g£50 gwhen gthe gexchange grate gis
g£1 g= g$2. gOne gyear glater, gthe gstock grises gto g£60. gYou gare ghappy gwith gyour g20 gpercent
greturn gon gthe gstock, gbut gwhen gyou gsell gthe gstock gand gexchange gyour g£60 gfor gdollars,
gyou gonly gget g$45 gsince gthe gpoundghas gfallen gto g£1 g= g$0.75. gThis gloss gof gvalue gis gan
gexample gof
A) exchange grate grisk.
B) political grisk.
C) market gimperfections.
D) weakness gin gthe gdollar.
8) Suppose gthat gGreat gBritain gis ga gmajor gexport gmarket gfor gyour gfirm, ga gU.S.-based
gMNC. gIfgthe gBritish gpound gdepreciates gagainst gthe gU.S. gdollar,
A) your gfirm gwill gbe gable gto gcharge gmore gin gdollar gterms gwhile gkeeping gpound
gprices
stable.
B) your gfirm gmay gbe gpriced gout gof gthe gU.K. gmarket, gto gthe gextent gthat gyour gdollar
gcosts
stay gconstant gand gyour gpound gprices gwill grise.
C) to gprotect gU.K. gmarket gshare, gyour gfirm gmay ghave gto gcut gthe gdollar gprice gof
gyour ggoodsgto gkeep gthe gpound gprice gthe gsame.
D) your gfirm gmay gbe gpriced gout gof gthe gU.K. gmarket, gto gthe gextent gthat gyour
gdollar gcosts gstay gconstant gand gyour gpound gprices gwill grise, gand gto gprotect gU.K.
gmarket gshare, gyour gfirm gmayghave gto gcut gthe gdollar gprice gof gyour ggoods gto gkeep gthe
gpound gprice gthe gsame.
9) Suppose gMexico gis ga gmajor gexport gmarket gfor gyour gU.S.-based gcompany gand gthe
Test Page g
gBank 4
