1. Usually the low interest rate currency trades at a ______ to the high interest rate currency in the forward market.6 H1 R w1 O. B
A. premium
' p- m) m8 i( h. ^, j9 O+ K( h B. par
$ s* G* g: b- w$ g/ D C. discount
B4 y: ]" ^! }1 W9 u8 x( r& X& | D. bar 2. Which of the following statements about standby letters of credit is true? ______.+ l% W3 a1 W I& l. M8 l
A. They can serve as a guarantee to a buyer against a seller defaulting
2 ~, _9 J' N0 r( K& _2 Q: T1 U. v B. They are contrary to the general rule that letters of credit may only be used for the actual movement of goods8 K$ x6 g3 J" t* r7 x3 L
C. They are unlike a tender (or other) bond in their legal standing and method of operation
$ [4 m- v- Q9 ~. O4 d& ~ D. They are unlike a tender bond with its fixed expiry date 3. The most liquid of all assets is ______.
! R1 M' E( p' o8 M+ E0 i: p, C A. the stock of commercial banks
8 {1 Q' x; O% f B. M 1
& M$ o- D% D l) M* [3 W+ E C. intelligence) I# R3 c# P3 I/ [1 O
D. the debt of major corporations 4. Beta and standard deviation differ as risk measures in that beta measures ______.$ L5 d/ q+ ]1 B! l b
A. only unsystematic risk, while standard deviation measures total risk
6 {( l* |6 U8 Q+ m B. only systematic risk, while standard deviation measures total risk0 A& R* i4 H7 [6 Y N" x
C. both systematic and unsystematic risk, while standard deviation measures only unsystematic risk2 Y7 n* H. g, t6 A! m6 e
D. both systematic and unsystematic risk, while standard deviation measures only systematic risk5. What information would you find in a statement of cash flows that you would not be able to get from the other two primary financial statements? ______.
+ U, W3 n6 k Z+ U/ S3 W A. Cash provided by or used in financing activities
* D& \/ _; I2 f6 c B. Cash balance at the end of the period
3 A5 c) Q( j0 \. f C. Total liabilities due to creditors at the end of the period5 P0 M( [4 N1 D0 x, Z7 V7 `
D. Net income 6. An analyst estimates that a stock has the following probabilities of return depending on the state of the economy: |