1. Under which one of the following circumstances would it be wise for your customer to arrange a forward foreign exchange contract? ______.( P* ?; X0 U l2 y
A. Import of goods priced in a foreign currency! z' x+ q$ n! s8 L6 G& ~! g
B. Import of goods priced in RMB
7 E/ L( [2 O- U, D/ l3 s9 ?6 h C. Export of goods priced in RMB& r2 b7 c; k1 n/ F M* d
D. Export of goods priced in a foreign currency where the rate of exchange has been agreed in the sales contract f0 e: W9 s( r& z! ~% S
2. Incoterms address ______.- u" C$ |! P9 A* u
A. the risks of loss between the parties# e) @9 O% ^. C* [9 u/ D3 l
B. breaches of contract& z5 v e- V3 \; L/ ^( W
C. ownership rights
* U( @3 u; T7 f8 b6 u. o, c D. type of ship used
8 x. N! w/ P$ T3 b' p, P% ] 3. Which of the following is or was an example of representative full-bodied money? ______.+ \/ n. b% j2 Q
A. Debt money
5 o; H$ T9 F3 ]# v B. ATS account
. v, n: }% d& X- l4 Q C. Gold certificate
9 _7 X$ l+ n; x! O! T D. Demand deposit% i! Z+ ?1 d8 V7 t! V0 m* n* V4 S
4. Risks associated with investing in foreign countries are the following except ______.
( H! M% O9 ^: \ A. voting risk, g m9 c4 @; \5 c. f3 E+ y8 S
B. exchange rate risk* N1 M: b) n4 O: p o+ S
C. country risk
: S' _- U9 ~7 _5 U/ _ `& T" i! w D. political risk
6 Q$ f4 \/ q. A, h 5. An exporter sells goods to a customer abroad on FOB and on CIF term. Who is responsible for the freight charges in each? ______.
+ O; O, s% L2 S1 T: y: D6 v A. Exporter; Exporter
2 e2 K% P( p5 X3 c2 R B. Exporter; Importer' w9 f& O7 }2 B
C. Importer; Importer
4 p2 h2 d' J$ d1 ^$ t& R D. Importer; Exporter! M% _4 H. D; F4 `; r8 o
6. Default risk refers to the possibility that a borrower may ______.: m$ U/ @7 W# {1 X8 F5 R
A. be unable to repay the principal on his loan
( k, I! F4 D9 T7 x" o2 `# Y B. be unable to make the interest payments on his loan
& c' W2 _7 e- x2 j C. go bankrupt8 K9 g1 Q$ F1 {2 S
D. all of the above' n+ V! `0 W1 S4 u& ]0 @+ F
7. What is the reserve requirement? ______.) W( n2 r. I' N) A" }' I1 b s
A. The requirement of a bank to deposit a percentage of money
+ j4 V- s- ? u0 K B. The requirement for deposits in cash1 E5 W/ V1 t2 Z5 Q- \
C. The percentage of a bank's deposits in the form of cash reserves
/ b: O; `. D5 j' ]! g D. The requirement for cash reserves( ^6 h7 e. R9 u3 m% d
8. A draft is like a check that can be endorsed but it isn't a title to goods, like ______.+ ~' S, b {+ z2 {; i
A. a bill of lading
: K5 L& B7 L$ P B. an inspection certificate. f2 }! k% i4 t; y( e
C. a certificate of origin
. H' L# {2 U$ y m8 e D. an insurance certificate' j* m a$ @6 i
9. Arbitrage ______.
: l; I* G9 t- P2 Z' O A. is a general economic term for buying something where it is cheap and selling it where it is dear* m# X1 e# H2 D j0 V, L8 M/ h1 b
B. keeps exchange rates consistent across markets: ~8 z; U8 O3 d. ~! p6 B- f" L
C. has been outlawed by the International Monetary Fund" r, ]& p6 n- y/ P
D. cannot occur where there is a forward exchange market; j7 t# p. k6 D7 p" m- T& j
E. both A and B6 z+ N2 ~; t5 J: w \! u
10. What is the purpose of comparing the ledger entries with the documents? ______.
- k0 t- V7 a6 M k( h A. To prove that all the transactions have made for the right amounts
- \5 d0 q# O( ~! }; ` B. To prove that all the accounts have been posted correctly
9 ~7 x3 ^& T$ N% ^1 n: Q' g6 M C. To check the number of all the debits and credits
: Q+ z3 H) j4 n3 ?; X: M: r D. To post the right accounts |