United States Dollar
Exam Name___________________________________
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) In the economic field of agency theory, which one of the following is viewed as an agent with the principals who are most importantly the firm's shareholders? A) managers B) employees C) attorneys D) suppliers 2) The cash manager at AmFlex Company needs to buy 1,000,000 British pounds to pay a British supplier. A currency broker quotes him a bid-ask rate of ₤.4865-.5116/US$. What will be the dollar cost of the 1,000,000 pounds? A) $486,618 B) $1,954,652 C) $511,587 D) $2,055,499 3) In determining why a firm becomes multinational there are many reasons. One reason is that the firm is a market seeker. Which of the following is NOT a reason why market seeking firms produce in foreign countries? A) Satisfaction of local demand in the domestic markets. B) Political safety and small likelihood of government expropriation of assets. C) Satisfaction of local demand in the foreign country. D) All of the above are market-seeking activities. 4) It is characteristic of foreign exchange dealers to A) trade only with clients in the retail market and never operate in the wholesale market for foreign exchange. B) bring buyers and sellers of currencies together but never to buy and hold an inventory of currency for resale. C) act as market makers, willing to buy and sell the currencies in which they specialize. D) All of the above are characteristics of foreign exchange dealers. 5) The broker at Deutsche Bank quotes bid-ask rates of ¥104.15-30/$. What would be its direct asking price for yen if the bank's €/$ ask rate is .6550? A) €159.24/¥ B) €.00628/¥ C) €.0061/¥ D) €164.25/¥ 6) Most foreign exchange transactions are through the U.S. dollar. If the transaction is expressed as the foreign currency per dollar this known as ________ whereas ________ are expressed as dollars per foreign unit. A) European terms; American terms B) American
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) In the economic field of agency theory, which one of the following is viewed as an agent with the principals who are most importantly the firm's shareholders? A) managers B) employees C) attorneys D) suppliers 2) The cash manager at AmFlex Company needs to buy 1,000,000 British pounds to pay a British supplier. A currency broker quotes him a bid-ask rate of ₤.4865-.5116/US$. What will be the dollar cost of the 1,000,000 pounds? A) $486,618 B) $1,954,652 C) $511,587 D) $2,055,499 3) In determining why a firm becomes multinational there are many reasons. One reason is that the firm is a market seeker. Which of the following is NOT a reason why market seeking firms produce in foreign countries? A) Satisfaction of local demand in the domestic markets. B) Political safety and small likelihood of government expropriation of assets. C) Satisfaction of local demand in the foreign country. D) All of the above are market-seeking activities. 4) It is characteristic of foreign exchange dealers to A) trade only with clients in the retail market and never operate in the wholesale market for foreign exchange. B) bring buyers and sellers of currencies together but never to buy and hold an inventory of currency for resale. C) act as market makers, willing to buy and sell the currencies in which they specialize. D) All of the above are characteristics of foreign exchange dealers. 5) The broker at Deutsche Bank quotes bid-ask rates of ¥104.15-30/$. What would be its direct asking price for yen if the bank's €/$ ask rate is .6550? A) €159.24/¥ B) €.00628/¥ C) €.0061/¥ D) €164.25/¥ 6) Most foreign exchange transactions are through the U.S. dollar. If the transaction is expressed as the foreign currency per dollar this known as ________ whereas ________ are expressed as dollars per foreign unit. A) European terms; American terms B) American