International Finance

International Finance

LIST OF ATTEMPTED QUESTIONS AND ANSWERS
True/False 
 Question
Integrated branches of Commercial banks handle forex transactions as well as options, swaps, futures, arbitrage operations
Correct Answer
True
Your Answer
True

True/False 
 Question
JV means Joint venture and WOS means World of Security.
Correct Answer
False
Your Answer
False

Select The Blank  
Question
The rate of interest on rupee finance for exports is not exceeding ________ less than PLR.
Correct Answer
0.025
Your Answer
50 basis points over LIBOR

Multiple Choice Multiple Answer  
Question
What does a speculator accept while dealing with an option?
Correct Answer
The exercise or strike price, the amount , The expiration date and time, the method of payment
Your Answer
The exercise or strike price, the amount , The expiration date and time, the method of payment

Multiple Choice Single Answer  
Question
In the syndicated loan arrangement the borrower has to execute :-
Correct Answer
Single Principal loan agreement
Your Answer
Single Principal loan agreement

True/False 
 Question
At Least one principal Lender bank is essential for issue of the ADR or GDR.
Correct Answer
False
Your Answer
True

Multiple Choice Single Answer  
Question
US financial system is the freest system because
Correct Answer
Institutions can introduce new products and instuments at the price of their choice.
Your Answer
Institutions can introduce new products and instuments at the price of their choice.

Multiple Choice Single Answer  
Question
In a coupon swap who is called the buyer?
Correct Answer
One who pays the fixed rate of interest
Your Answer
One who pays the fixed rate of interest

True/False 
 Question
Till August 1994 India was following the Indirect Methodof Rate quotation.
Correct Answer
False
Your Answer
False

Select The Blank  
Question
For setting up joint ventures abroad or equity participation abroad, EXIM bank provides funds under ________ Scheme.
Correct Answer
Overseas investment facility
Your Answer
Overseas investment facility

Multiple Choice Single Answer
  Question
Under the automatic route of Direct Investment Abroad, what is the restriction on market purchases?
Correct Answer
50% of the net worth of the investing company
Your Answer
50% of the net worth of the investing company

Multiple Choice Single Answer  
Question
What are the powers of money changers?
Correct Answer
Purchase and sell foreign currency notes and travellers cheques
Your Answer
Purchase and sell foreign currency notes and travellers cheques and also Give export finance

Select The Blank  
Question
Any company involved in foreign exchange transactions is exposed to ________ risk.
Correct Answer
Currency
Your Answer
Currency

Multiple Choice Multiple Answer 
 Question
What are the features of Settlement price ?
Correct Answer
Price established by the clearing house at the end of each trading session , It is used to determine the net gain, loss, margin call and next days price limits
Your Answer
Price established by the clearing house at the end of each trading session , It is used to determine the net gain, loss, margin call and next days price limits

Multiple Choice Multiple Answer
  Question
What are the activities of ICC?
Correct Answer
Aribtration and dispute resolving , Canvass for open trade combat commercial crime
Your Answer
Aribtration and dispute resolving , Canvass for open trade combat commercial crime , Increased Govt regulation of Business

True/False  
Question
Cause of increase in cost of public issues Underwriting fees , selling commission
Correct Answer
True
Your Answer
False

Select The Blank  
Question
The currency swaps used ________.
Correct Answer
To lower the risk of currency exposure
Your Answer
To lower the risk of currency exposure

True/False  
Question
The Option period in the forward contract is at the option of the Banker, hence the bank has to be very conservative in quoting rates.
Correct Answer
False
Your Answer
True

Multiple Choice Multiple Answer  
Question
Which factors affect the exchange rates in short time period?
Correct Answer
Demand and supply, interest rates, inflation, , Sentiment, Speculation
Your Answer
Demand and supply, interest rates, inflation, , Sentiment, Speculation , GDP,Balance of trade and payment,Unemployment

Match The Following
QuestionCorrect Answer
Your Answer
Departure
EXW
EXW
Main carriage paid
CFR
CFR
Main carriage unpaid
FAS
FAS
Arrival
DES
DES

Multiple Choice Multiple Answer  
Question
Sterling Market is attractive for an international investor because
Correct Answer
Gilts offer higher attractive margin , Choice of issuing medium term and long term bonds
Your Answer
Gilts offer higher attractive margin , Choice of issuing medium term and long term bonds , Linking of issues to currency swaps

True/False  
Question
In red clause credit some clauses are printed in Red ink.
Correct Answer
True
Your Answer
False

Multiple Choice Multiple Answer
  Question
Which debits are permitted to EEFC accounts?
Correct Answer
Payment of hotel bills abroad, payment for expenses on Heart operation abroad , Payment to EOUs in India for services rendered by them
Your Answer
Payment of hotel bills abroad, payment for expenses on Heart operation abroad , Payment to EOUs in India for services rendered by them

Multiple Choice Single Answer  
Question
Punjab National Bank Mumbai Branch quoted USD 1= Rs 50.5000/52.5050. Which is the bid rate for USD?
Correct Answer
USD 1=Rs 50.5000
Your Answer
USD 1=Rs 50.5000

Multiple Choice Single Answer  
Question
Why are various methods of financial analysis used for assessing a cross border project ?
Correct Answer
To weed out unviable projects and rank profitable ones
Your Answer
To weed out unviable projects and rank profitable ones

Multiple Choice Multiple Answer  
Question
Criteria for investment abroad under automatic route :-
Correct Answer
Activity for investment is core activity of Indian Company. , Total Financial commitment in JV/WOS as per prescribed ceiling
Your Answer
Activity for investment is core activity of Indian Company. , Total Financial commitment in JV/WOS as per prescribed ceiling

Multiple Choice Multiple Answer  
Question
Who can issue the Certificate of Inspection?
Correct Answer
Export Inspection Council , Person authorised by Importer.
Your Answer
Export Inspection Council , Person authorised by Importer.

Multiple Choice Single Answer  
Question
Large number of exporters from which country are enjoying the privilege of receiving up front cash from importers in Russia?
Correct Answer
United Kingdom
Your Answer
United Kingdom

True/False 
 Question
In developed markets, speculators play important role in determining the trend of currency rates.
Correct Answer
True
Your Answer
True

Select The Blank  
Question
In US Capital Market a Company prepares all the necessary documents in advance of the public issue under the facility known as ________.
Correct Answer
Shelf Registration
Your Answer
Shelf Registration

Select The Blank  
Question
In Overseas market the forward rate is generally quoted on the basis of ________.
Correct Answer
Fixed date
Your Answer
Calendar month

Select The Blank  
Question
Forward Margin makes a currency costlier then the currency is at ________.
Correct Answer
Premium
Your Answer
Discount

Multiple Choice Multiple Answer  
Question
These are the parties to the documentary credit :-
Correct Answer
Negotiating Bank, advising bank , Reimbursing bank, Confirming bank
Your Answer
Negotiating Bank, advising bank , Reimbursing bank, Confirming bank

Multiple Choice Multiple Answer  
Question
What are the functions of Asian Development Bank?
Correct Answer
Give Softloans to poorer countries in Asia , Give project finance from resources raised in world capital market
Your Answer
Give Softloans to poorer countries in Asia , Give project finance from resources raised in world capital market

Multiple Choice Single Answer  
Question
Fixed, Floating or Limited flexibility are used in the context of
Correct Answer
Exchange Rates
Your Answer
Exchange Rates

Select The Blank 
 Question
In mid 1992 ________ rejected the ratification of Maastricht treaty
Correct Answer
Denmark
Your Answer
UK

Multiple Choice Multiple Answer 
 Question
Under the liberalisation through FEMA, what can an AD offer to the clients, without the prior permission of RBI or Government?
Correct Answer
Hedges, interest rate swaps, currency swaps. , Caps and collars, and forward rate agreements
Your Answer
Hedges, interest rate swaps, currency swaps. , Caps and collars, and forward rate agreements
  Question
To whom is an AD required to report the cancellation of forward contracts?
Correct Answer
No one at all.
Your Answer
To Reserve Bank of India, fortnightly

Select The Blank  

International Finance -3

LIST OF ATTEMPTED QUESTIONS AND ANSWERS
True/False
* Question -
Integrated branches of Commercial banks handle forex transactions as well as options, swaps, futures, arbitrage operations
Correct Answer
True
Your Answer
True

True/False
* Question -
JV means Joint venture and WOS means World of Security.
Correct Answer
False
Your Answer
False

Select The Blank
* Question -
The rate of interest on rupee finance for exports is not exceeding ________ less than PLR.
Correct Answer
0.025
Your Answer
50 basis points over LIBOR

Multiple Choice Multiple Answer
* Question -
What does a speculator accept while dealing with an option?
Correct Answer
The exercise or strike price, the amount , The expiration date and time, the method of payment
Your Answer
The exercise or strike price, the amount , The expiration date and time, the method of payment

Multiple Choice Single Answer
* Question -
In the syndicated loan arrangement the borrower has to execute :-
Correct Answer
Single Principal loan agreement
Your Answer
Single Principal loan agreement

True/False
* Question -
At Least one principal Lender bank is essential for issue of the ADR or GDR.
Correct Answer
False
Your Answer
True

Multiple Choice Single Answer
* Question -
US financial system is the freest system because
Correct Answer
Institutions can introduce new products and instuments at the price of their choice.
Your Answer
Institutions can introduce new products and instuments at the price of their choice.

Multiple Choice Single Answer
* Question -
In a coupon swap who is called the buyer?
Correct Answer
One who pays the fixed rate of interest
Your Answer
One who pays the fixed rate of interest

True/False
* Question -
Till August 1994 India was following the Indirect Methodof Rate quotation.
Correct Answer
False
Your Answer
False

Select The Blank
* Question -
For setting up joint ventures abroad or equity participation abroad, EXIM bank provides funds under ________ Scheme.
Correct Answer
Overseas investment facility
Your Answer
Overseas investment facility

Multiple Choice Single Answer
* Question -
Under the automatic route of Direct Investment Abroad, what is the restriction on market purchases?
Correct Answer
50% of the net worth of the investing company
Your Answer
50% of the net worth of the investing company

Multiple Choice Single Answer
* Question -
What are the powers of money changers?
Correct Answer
Purchase and sell foreign currency notes and travellers cheques
Your Answer
Purchase and sell foreign currency notes and travellers cheques and also Give export finance

Select The Blank
* Question -
Any company involved in foreign exchange transactions is exposed to ________ risk.
Correct Answer
Currency
Your Answer
Currency

Multiple Choice Multiple Answer
* Question -
What are the features of Settlement price ?
Correct Answer
Price established by the clearing house at the end of each trading session , It is used to determine the net gain, loss, margin call and next days price limits
Your Answer
Price established by the clearing house at the end of each trading session , It is used to determine the net gain, loss, margin call and next days price limits

Multiple Choice Multiple Answer
* Question -
What are the activities of ICC?
Correct Answer
Aribtration and dispute resolving , Canvass for open trade combat commercial crime
Your Answer
Aribtration and dispute resolving , Canvass for open trade combat commercial crime , Increased Govt regulation of Business

True/False
* Question -
Cause of increase in cost of public issues Underwriting fees , selling commission
Correct Answer
True
Your Answer
False

Select The Blank
* Question -
The currency swaps used ________.
Correct Answer
To lower the risk of currency exposure
Your Answer
To lower the risk of currency exposure

True/False
* Question -
The Option period in the forward contract is at the option of the Banker, hence the bank has to be very conservative in quoting rates.
Correct Answer
False
Your Answer
True

Multiple Choice Multiple Answer
* Question -
Which factors affect the exchange rates in short time period?
Correct Answer
Demand and supply, interest rates, inflation, , Sentiment, Speculation
Your Answer
Demand and supply, interest rates, inflation, , Sentiment, Speculation , GDP,Balance of trade and payment,Unemployment

Match The Following
Question
Correct Answer
Your Answer
Departure
EXW
EXW
Main carriage paid
CFR
CFR
Main carriage unpaid
FAS
FAS
Arrival
DES
DES

Multiple Choice Multiple Answer
* Question -
Sterling Market is attractive for an international investor because
Correct Answer
Gilts offer higher attractive margin , Choice of issuing medium term and long term bonds
Your Answer
Gilts offer higher attractive margin , Choice of issuing medium term and long term bonds , Linking of issues to currency swaps

True/False
* Question -
In red clause credit some clauses are printed in Red ink.
Correct Answer
True
Your Answer
False

Multiple Choice Multiple Answer
* Question -
Which debits are permitted to EEFC accounts?
Correct Answer
Payment of hotel bills abroad, payment for expenses on Heart operation abroad , Payment to EOUs in India for services rendered by them
Your Answer
Payment of hotel bills abroad, payment for expenses on Heart operation abroad , Payment to EOUs in India for services rendered by them

Multiple Choice Single Answer
* Question -
Punjab National Bank Mumbai Branch quoted USD 1= Rs 50.5000/52.5050. Which is the bid rate for USD?
Correct Answer
USD 1=Rs 50.5000
Your Answer
USD 1=Rs 50.5000

Multiple Choice Single Answer
* Question -
Why are various methods of financial analysis used for assessing a cross border project ?
Correct Answer
To weed out unviable projects and rank profitable ones
Your Answer
To weed out unviable projects and rank profitable ones

Multiple Choice Multiple Answer
* Question -
Criteria for investment abroad under automatic route :-
Correct Answer
Activity for investment is core activity of Indian Company. , Total Financial commitment in JV/WOS as per prescribed ceiling
Your Answer
Activity for investment is core activity of Indian Company. , Total Financial commitment in JV/WOS as per prescribed ceiling

Multiple Choice Multiple Answer
* Question -
Who can issue the Certificate of Inspection?
Correct Answer
Export Inspection Council , Person authorised by Importer.
Your Answer
Export Inspection Council , Person authorised by Importer.

Multiple Choice Single Answer
* Question -
Large number of exporters from which country are enjoying the privilege of receiving up front cash from importers in Russia?
Correct Answer
United Kingdom
Your Answer
United Kingdom

True/False
* Question -
In developed markets, speculators play important role in determining the trend of currency rates.
Correct Answer
True
Your Answer
True

Select The Blank
* Question -
In US Capital Market a Company prepares all the necessary documents in advance of the public issue under the facility known as ________.
Correct Answer
Shelf Registration
Your Answer
Shelf Registration

Select The Blank
* Question -
In Overseas market the forward rate is generally quoted on the basis of ________.
Correct Answer
Fixed date
Your Answer
Calendar month

Select The Blank
* Question -
Forward Margin makes a currency costlier then the currency is at ________.
Correct Answer
Premium
Your Answer
Discount

Multiple Choice Multiple Answer
* Question -
These are the parties to the documentary credit :-
Correct Answer
Negotiating Bank, advising bank , Reimbursing bank, Confirming bank
Your Answer
Negotiating Bank, advising bank , Reimbursing bank, Confirming bank

Multiple Choice Multiple Answer
* Question -
What are the functions of Asian Development Bank?
Correct Answer
Give Softloans to poorer countries in Asia , Give project finance from resources raised in world capital market
Your Answer
Give Softloans to poorer countries in Asia , Give project finance from resources raised in world capital market

Multiple Choice Single Answer
* Question -
Fixed, Floating or Limited flexibility are used in the context of
Correct Answer
Exchange Rates
Your Answer
Exchange Rates

Select The Blank
* Question -
In mid 1992 ________ rejected the ratification of Maastricht treaty
Correct Answer
Denmark
Your Answer
UK

Multiple Choice Multiple Answer
* Question -
Under the liberalisation through FEMA, what can an AD offer to the clients, without the prior permission of RBI or Government?
Correct Answer
Hedges, interest rate swaps, currency swaps. , Caps and collars, and forward rate agreements
Your Answer
Hedges, interest rate swaps, currency swaps. , Caps and collars, and forward rate agreements

Multiple Choice Single Answer
* Question -
To whom is an AD required to report the cancellation of forward contracts?
Correct Answer
No one at all.
Your Answer
To Reserve Bank of India, fortnightly

Select The Blank
* Question -
ECGC provides cover to an Indian contractor for construction work abroad under ________.
Correct Answer
Construction works policy
Your Answer
Export Performance Guarantee

True/False
* Question -
The Negotiating bank examines the documents submitted by the seller and makes payment if they comply the terms and conditions of the LC.
Correct Answer
True
Your Answer
True

Multiple Choice Single Answer
* Question -
What was the official foreign currency reserve of the group of seven central Banks taken togeather in mid 1992?
Correct Answer
USD 275 Billion
Your Answer
USD 275 Billion

Multiple Choice Multiple Answer
* Question -
What are the sources of raising funds for exports?
Correct Answer
Suppliers credit , Forfaiting
Your Answer
Suppliers credit , Forfaiting

Select The Blank
* Question -
Forward margin makes a currency cheaper then the currency is at ________.
Correct Answer
Discount
Your Answer
Discount

Multiple Choice Single Answer
* Question -
Name the common forex derivatives :-
Correct Answer
Options, futures
Your Answer
Options, futures

True/False
* Question -
Country risk analysis is a futile exercise in the background of cost of analysis.
Correct Answer
True
Your Answer
False

Select The Blank
* Question -
Even after liberalisation of exchange controls, the Euro sterling market remained volatile because of uncertainties in UK and gyrations of sterling against major ________ countries
Correct Answer
OECD
Your Answer
OECD

Match The Following
Question
Correct Answer
Your Answer
Issues linked with LIBOR,LIBID,LIMEAN
FRNs
FRNs
Issue of bonds without fixed rate of interest, linked to short term interest rate in the global market
FloatingRate Note
FloatingRate Note
Issue of loans internationally,through arranger, underwriter,co manager, for a large amount for sharing risk of lending
Syndicated Loans
Syndicated Loans
Equity issues in the foreign markets either as direct investments or portfolio investments.
American or Global Depository Receipts
American or Global Depository Receipts

at 5:35 AM 0 comments Links to this post  

International Finance - 2

Multiple Choice Multiple Answer
* Question -
What schemes have been floated by RBI for facilitating Inter bank transactions?
Correct Answer
Clearing house for settlement and clearance for the operations of Ads , Set up a market intelligence cell to study and monitor developments in Forex Market
Your Answer
Clearing house for settlement and clearance for the operations of Ads , Make additional foreign currency available to ADs at cheaper rates

Select The Blank
* Question -
________ is the agency of ICC which deals with the maritime crime.
Correct Answer
International Maritime Bureau
Your Answer
International Maritime Bureau

Multiple Choice Single Answer
* Question -
Which of them are special funding facilities of IMF ?
Correct Answer
Buffer Stock Facility
Your Answer
Buffer Stock Facility

True/False
* Question -
Cross currency forward contract is not meaningful if original contract is in Rupees to USD
Correct Answer
True
Your Answer
True

Multiple Choice Multiple Answer
* Question -
What does a speculator accept while dealing with an option?
Correct Answer
The exercise or strike price, the amount , The expiration date and time, the method of payment
Your Answer
The exercise or strike price, the amount , The expiration date and time, the method of payment , The Market report of the exchange which trades the option

Multiple Choice Single Answer
* Question -
Which is the most actively traded currency in the international market today?
Correct Answer
US Dollar
Your Answer
US Dollar

Match The Following
Question
Correct Answer
Your Answer
Intolerable risk
Drop the investment project
Drop the investment project
Country risk analysis
Cost of evluation does not justify analysis
Cost of evluation does not justify analysis
Stock market analysis
Banks are ahead
Factors' values
Weightages %
Factors' values
100% of total

Select The Blank
* Question -
Global capital market can be understood from the study of ________.
Correct Answer
Yen,Euro Dollar, Swiss Francs, USD market, Govt Borrowings within and outside the country
Your Answer
Yen,Euro Dollar, Swiss Francs, USD market, Govt Borrowings within and outside the country

Multiple Choice Single Answer
* Question -
For a spot transaction carried out on Thursday, currencies will be exchanged on :-
Correct Answer
Monday
Your Answer
Monday

Multiple Choice Single Answer
* Question -
Under which category of exchange rate did the Indian Rupee came from June 92?
Correct Answer
Other managed Floating
Your Answer
Pegged to Single currency

Match The Following
Question
Correct Answer
Your Answer
Maturity of future
Time when actual commodity is delivered
Last date of exercising option
Note issuance facility
Euronotes
Euronotes
Bearer security issued in currency other than that of the country of issue
Eurobonds
Eurobonds
Margin on future
Peformance bond or security deposit
Peformance bond or security deposit

True/False
* Question -
Postal receipt is an acknowledgement of receipt of goods, a quasi negotiable instrument.
Correct Answer
False
Your Answer
False

True/False
* Question -
The Prominent non banking financial institutions participating in the FOREX markets are Pension funds, mutual funds, insurance Cos.
Correct Answer
True
Your Answer
True

Multiple Choice Multiple Answer
* Question -
What are margins, with reference to futures market?
Correct Answer
Faith money deposited by buyers and sellers ensures liquidity , Margin ensures solvency for honouring contracts
Your Answer
Faith money deposited by buyers and sellers ensures liquidity , Margin ensures solvency for honouring contracts

Multiple Choice Single Answer
* Question -
What is the volume of the world's average daily transactions in foreign exchange?
Correct Answer
USD 1 trillion
Your Answer
USD 1 trillion

Multiple Choice Single Answer
* Question -
NIF is basically an agreement :-
Correct Answer
By underwriting bank to support funding for a certain period, against which borrowers can issue short term papers
Your Answer
Which enables the investor to market the same in the secondary market

Multiple Choice Single Answer
* Question -
What was the official foreign currency reserve of the group of seven central Banks taken togeather in mid 1992?
Correct Answer
USD 275 Billion
Your Answer
USD 275 Billion

Multiple Choice Single Answer
* Question -
What Preshipment facility is granted by EXIM Bank to an exporter?
Correct Answer
Preshipment credit beyond six months for construction and turnkey projects abroad
Your Answer
Preshipment credit up to six months for construction and turnkey projects abroad

Select The Blank
* Question -
Over the years ________has been the most widely accepted currency in international capital market.
Correct Answer
American Dollar
Your Answer
American Dollar

Select The Blank
* Question -
As a result of the world wars in the 20th century the ________ of most of the countries suffered heavily.
Correct Answer
Economies
Your Answer
Currencies

Multiple Choice Single Answer
* Question -
Which currency is traded in one leg of about 70% of the world's transactions?
Correct Answer
US Dollar
Your Answer
US Dollar

Select The Blank
* Question -
________ is the acid test for events to be included in country risk.
Correct Answer
Control by Government'
Your Answer
Recurrence

Select The Blank
* Question -
The Trans European Automated Real Time Gross Settlement Express Transfer is popular in ________.
Correct Answer
Brussels
Your Answer
Brussels

Multiple Choice Single Answer
* Question -
What is Risk Syndication facility?
Correct Answer
Sharing of risk of non payment by supplier
Your Answer
Sharing risk of Non payment by the Syndicate of Banks giving loans

True/False
* Question -
If ERD > IRD hen exporter should availa Rupee finance
Correct Answer
True
Your Answer
True

Multiple Choice Multiple Answer
* Question -
The characteristics of an International documentary credit are :-
Correct Answer
It is an undertaking given by the openers bank to pay certain sum of money , It is an undertaking given on behalf of a certain person to another person in different country
Your Answer
It is an undertaking given by the openers bank to pay certain sum of money , It is an undertaking given on behalf of a certain person to another person in different country

Multiple Choice Multiple Answer
* Question -
Which debits are permitted to EEFC accounts?
Correct Answer
Payment of hotel bills abroad, payment for expenses on Heart operation abroad , Payment to EOUs in India for services rendered by them
Your Answer
Payment of hotel bills abroad, payment for expenses on Heart operation abroad , Payment to EOUs in India for services rendered by them

True/False
* Question -
Funding Options in domestic yen market are Futures, FRAs, Call and put options.
Correct Answer
True
Your Answer
True

True/False
* Question -
There is no difference between CIP and CIF contracts except the mode of transportation.
Correct Answer
True
Your Answer
True

Multiple Choice Single Answer
* Question -
Financial management is complex process for
Correct Answer
Companies which have international trade
Your Answer
Companies which have international trade

Select The Blank
* Question -
When an Indian Company earns at least 50% of its average turnover from a particular activity then that activity is considered as ________.
Correct Answer
Core activity
Your Answer
Primary activity

Select The Blank
* Question -
A Credit can be a confirmed credit only if it is also ________.
Correct Answer
An Irrevocable credit
Your Answer
An Irrevocable credit

True/False
* Question -
The volume of trading of Derivatives in the world trade market is growing but still only 5% of the total.
Correct Answer
False
Your Answer
False

Multiple Choice Single Answer
* Question -
Punjab National Bank Mumbai Branch quoted USD 1= Rs 50.5000/52.5050. Which is the offered rate for Rs?
Correct Answer
USD 1=Rs 50.5000
Your Answer
USD 1=Rs 50.5000

Multiple Choice Multiple Answer
* Question -
Export finance
Correct Answer
Preshipment credit , Post shipment credit , Duty Draw back
Your Answer
Preshipment credit , Post shipment credit , Buyers credit

Multiple Choice Multiple Answer
* Question -
Internationally only those currencies are in demand
Correct Answer
Which are convertible , Which have liquidity confirmed in Euro market operations
Your Answer
Which are convertible , Which have liquidity confirmed in Euro market operations , Which have greater intrinsic value

Multiple Choice Multiple Answer
* Question -
What are the functions of Asian Development Bank?
Correct Answer
Give Softloans to poorer countries in Asia , Give project finance from resources raised in world capital market
Your Answer
Give Softloans to poorer countries in Asia , Give project finance from resources raised in world capital market

Multiple Choice Multiple Answer
* Question -
What does the word '"Tombstone" stand for?
Correct Answer
Advertisement which lists the managers, underwriters, , List of Providers of recently floated issue
Your Answer
Advertisement which lists the managers, underwriters, , List of Providers of recently floated issue

Select The Blank
* Question -
Short term instruments normally issued by corporate borrowers, forhigh values, at a discount to face value are known as ________.
Correct Answer
Euro Commercial Papers
Your Answer
Euro Commercial Papers

Multiple Choice Single Answer
* Question -
Why are various methods of financial analysis used for assessing a cross border project ?
Correct Answer
To weed out unviable projects and rank profitable ones
Your Answer
To weed out unviable projects and rank profitable ones

Multiple Choice Single Answer
* Question -
Examples of hedge are:
Correct Answer
Buy when you are having short position
Your Answer
Buy when you are having short position

Multiple Choice Multiple Answer
* Question -
What is the effect of cross currency option on the customer?
Correct Answer
He gets the flexibility to exposure , He is exposed to additional risk of movement of rates between 3 currencies
Your Answer
He gets the flexibility to exposure , He is exposed to additional risk of movement of rates between 3 currencies

Select The Blank
* Question -
Forward margin makes a currency cheaper then the currency is at ________.
Correct Answer
Discount
Your Answer
Discount

Multiple Choice Single Answer
* Question -
Why does a person need protection from unfavourable movement of exchange rate?
Correct Answer
Unfavourable fluctuations in exchange rate can wipe out the normal business profit
Your Answer
Unfavourable fluctuations in exchange rate can wipe out the normal business profit

Multiple Choice Single Answer
* Question -
The capital market is said to be volatile when
Correct Answer
Prices of capital market instruments change and are expected to change drastically
Your Answer
Prices of capital market instruments change and are expected to change drastically

True/False
* Question -
JV means Joint venture and WOS means World of Security.
Correct Answer
False
Your Answer
False

Multiple Choice Multiple Answer
* Question -
What is the criteria for an Indian Company for Direct Investment abroad?
Correct Answer
Activity proposed need to be core activity , Financial commitment in JV/WOS maximum $ 100 million or equivalent
Your Answer
Activity proposed need to be core activity , Financial commitment in JV/WOS maximum $ 100 million or equivalent , Indian co should not have been black listed

International Finance - 1

Multiple Choice Multiple Answer
* Question -
What are the categories of exposures, a person faces in International trade?
Correct Answer
Transaction exposure , Translation exposure
Your Answer
Transaction exposure , Exchange rate fluctuation , Political changes

Multiple Choice Multiple Answer
* Question -
The factors which affect the performance of an option are:-
Correct Answer
Underlying asset price , Time before expiration, rate of interest
Your Answer
Underlying asset price , Time before expiration, rate of interest

Select The Blank
* Question -
The option which can be exercised on the maturity date and not before it is known as________.
Correct Answer
European Option
Your Answer
European Option

Multiple Choice Single Answer
* Question -
What are the powers of restricted money changers?
Correct Answer
Purchase foreign currencies
Your Answer
Purchase and sell foreign currency notes and travellers cheques

Multiple Choice Multiple Answer
* Question -
Which contracts are used for transportation by road?
Correct Answer
FCA , CPT

Your Answer
FCA , CPT

 Multiple Choice Multiple Answer

* QuestionThe World Bank Group Consists of
 Correct Answer
International Development Association , International finance Corporation , Multinational Investment Guarantee Agency

 True/False

* QuestionNaked position is when investor does not hedge against market risk.
 Correct Answer
True
Your Answer
TRUE

Multiple Choice Multiple Answer
*Question
In DAF, the frontier means :-
Correct Answer
Frontier of exporter's country , Frontier of importer's country

Multiple Choice Single Answer

* Question
Which type of Convertibility of Rupee launched in March 1992 ?
Correct Answer

Limited convertibility
 Your Answer
Convertibility on current account

Multiple Choice Single Answer
*Question
What was the reason for launching swap as an risk hedging instrument?
 Correct Answer
To avoid the effects of currency control imposed in UK
 Your Answer
To avoid the effects of currency control imposed in UK

 Multiple Choice Single Answer

*  Question
Equity can be raised internationallly by a company through :-
Correct Answer
Fund raising, underwriting, hedging , arbitration operations
Your Answer
Floating debt instruments

True/False
*Question
In forward sales, the delivery refers to actual cash flows on due date.
Correct Answer
True
 Select The Blank
 Question
Any company involved in foreign exchange transactions is exposed to ________ risk.
 Correct Answer
Currency
Your Answer
Payment

 True/False
 *Question
An AD can book a forward contract for a part of the amount of Sale Contract
 Correct Answer
True

 Multiple Choice Single Answer
* Question
Why does a person need protection from unfavourable movement of exchange rate?
Correct Answer
Unfavorable fluctuations in exchange rate can wipe out the normal business profit
Your Answer
He wants to make profit

 Match The Following

*Question
Correct Answer
Your Answer

Merchant banking
Portfolio management
Portfolio management

Securitization
Issue of debt in the form of tradeable security
Issue of debt in the form of tradeable security

Prime borrower
Highest credit rating
Highest credit rating

Traditional banking service
Loans and cash credit against security
Loans and cash credit against security

 Multiple Choice Multiple Answer

* Question
What are the activities of ICC?
 Correct Answer
Aribtration and dispute resolving , Canvass for open trade combat commercial crime

 Your Answer
Aribtration and dispute resolving , Canvass for open trade combat commercial crime

 Multiple Choice Multiple Answer

*Question
Which factors influence the valuation of cash flows?
 Correct Answer
Incomplete capital market , Availability of projkect specific concessional finance,
 Your Answer
Incomplete capital market , Rates of inflation, , volatility of exchange rates

 Multiple Choice Multiple Answer
*Question
What is the objective of FEDAI?
Correct Answer
Laying down terms and conditions of exchange business between Customers and Bankers , Interbank understanding for transacting forex business and exchange rates
 Your Answer
Laying down terms and conditions of exchange business between Customers and Bankers , Growth of Indian Exports , Ensure the profitability of Forex business to the banks

Select The Blank
 *Question
Forward margin makes a currency cheaper then the currency is at ________.
Correct Answer
Discount
Your AnswerPAR

Match The Following

*Question
Correct Answer
Your Answer

Intolerable risk
Drop the investment project
Cost of evluation does not justify analysis

Country risk analysis
Cost of evluation does not justify analysis
Continue the project

Stock market analysis
Banks are ahead
Banks are ahead

Weightages %
Factors' values
Factors' values

 Multiple Choice Single Answer
* Question
A bill of exchange issued by a bank which pays specified sum of money to the holder on a specific date is called :-

Correct Answer
Bankers' Acceptance Bond
 Your Answer
Usance Bill of Exchange

 Multiple Choice Single Answer
 Question
In the syndicated loan arrangement the borrower has to execute :-

 Correct Answer
Single Principal loan agreement
 Your Answer
Single Principal loan agreement

 Select The Blank
 Question
Rupee was liberalised on ________ account in 1993, and on current account in 1994.
Correct Answer
Trade
Your Answer

Capital

Select The Blank
 Question
Indian Co. intending to make investment under Automatic route needs to submit form ________ to RBI with enclosures.

Correct Answer
ODA
 Your Answer
ODA

Multiple Choice Multiple Answer
 Question
A Forward purchase contract was booked with an authorised dealer and subsequently cancelled .It :-

 Correct Answer
Can be booked again with another dealer , Can be booked again with the same dealer

 Your Answer
Can be booked again with another dealer , Can be booked again with the same dealer , Can be booked only for un booked portion of the contract.

Select The Blank
* Question -
The ________is a Floating rate index for swaps.
Correct Answer
US Commercial paper rate
Your Answer
US Commercial paper rate

International Finance -2

1. Which factors are considered by RBI before granting permission to Foreign Company to set up a branch office in India?

• Track reco of the co, existing trade reltns, fin positin of the co
• Portfolio investment capacity,technology transfer intended
• Personnel working in the company, inward remittance
• External value of the currency of the company, company profile

2. Import finance is normally available at rates cheaper than domestic rates

• True / False

3. While transferring a share from resident to nonresident whose permission has to be taken

• Sect of inds assistance goi
• SEBI,
• RBI,
• stockexchange of nonresidents country

4.Packing credit is extended for a period of ----- days , 60 days,90 days, 120days, 180 days

5. Name the types of commercial debt markets

Domestic, offshore, bond mkt, derivative mkt

6. Export finance can be classified into :

Preshipment credit, post shipment credit, dutydrawback, buyers credit

7. EXIM bank acts as a __________ for RBI, GOvt & IDBI.

Agent, financier, AD, co banker

8. Exports on Defered payment credit are eligible for fin & refinance from EXIM bank, T /F

9. When is an invoice considered to be a consular?

Consularised by EXIM Bk , World BK, Exchange control of India, notation by consular of the importer in the exporters country

10. Agency which issue export certificates?

EXIM Bank, Export promotion council, commodity board, chamber of commerce

11. No guidelines on quality have been provided for investment under Liberalised remittance 25,000USD scheme by RBI: T/F

12. Within 30 days of receipt of money from For Investment the Indian Co. will report to the RO of RBI what details :

Name & address of the FI, Date of Receipt of funds, Identification no of FI, Details of govt. Approval

13. Indian party which has made direct investment abroad has to submit an Annual perf report in form ARP-1 to RBI : T /F

14. Date of exchange of currency : value date, delivery date, odd date, expiry date

15. Maxim for forex dealers in Indirect rate method : Buy Low, Sell High : Buy High, Sell High : Buy Low, Sell High : Buy High, Sell Low

16. Export finance terms : timely, adequate, cheap & liberal terms

17. EXIM bank give direct credit to Import of Capital Goods under :

Buyers Credit, Sellers credit, Exp promotion credit, Import abroad credit

18. Franchising & marketing cost for hotel & tourism related tech transfer is limited to : 3% of the gross room sales, 3% of annual turnover

19. What is the facility provided by ECGC to consultant who receive payments over a period of years from clients abroad?

Exchange risk coverage, turnover policy, service policy

20. A country can raise finance through bilateral aid of Line of credit from other countries : T / F

21. _________ insures risk in international trade . EXIM Bank, ECGC, RBI, ICC

22. International Bureau was renamed as -------------.  FEDAI, INCOTERMS, World Chamber Federation, Uniform Customs & Practices

23. In case of import finance through Trust Receipts, with whom does the ownership of goods remain?

Exporter / Importer / Bank of Importer / Bank releasing the import documents

24. Income from interest on balances in NRE account is exempt from Income Tax . T / F

25. All transactions undertaken which do not alter his assets / Liabilities outside India are _----------- account transactions : current acct / capital account / resident account

26. Which type of account can be opened in EEFC ? SB / Current Account / Fixed deposit / Repatriable Acct

27. On which date did FEMA come in to force : 1^st June 2000

28. Which are the sources of raising funds : own funds, syndicated loans, friends & relatives, banks

29. ICC’s organ of settlement of disputes is ---------.

30. ------------- is non-recourse discounting of export receivables : forfeiting, import loan, export loan

31. It is obligatory for Authorised Dealers under section 74 of FERA to comply with all general & specific directives given by RBI . T / F

32. Debt swaps & asset swaps linked to bonds are----------- : Arbritage , ECBs, equity investments, Floating rate notes

32. Line of credit in African countries is extended by ------------ : Dev Bank of India, IDBI, EXIM, RBI

33. EEFC account holder is eligible to have --------------facility: cheque book & nomination, OD facility, Credit card facility, loan against EEFC account balance