What is the name of the exchange rate system where the governments attempt to make sure the values of their currencies trade at particular values in the foreign exchange market, relative to another currency or a “basket” of currencies? A) European currency unit B) fixed currencies C) floating currencies D) dirty float currency […]
A decrease in collection efforts by a firm will result in ________ in sales volume, ________ in the investment in accounts receivable, ________ in bad debt expenses, and ________ in collection expenditures. A) an increase; an increase; an increase; a decrease B) an increase; a decrease; an increase; an increase C) an increase; a decrease; […]
What is the name of the value of the real resources that the central bank obtains through the creation of base money? A) seigniorage B) sterilized intervention C) dollarization D) target zone ANSWER Answer: A
An increase in accounts receivable turnover for a firm due to an increase in collection efforts will ________. A) decrease the firm’s marginal investments in accounts receivable B) increase the firm’s marginal investments in accounts receivable C) decrease the firm’s collection expense D) increase the firm’s bad debt expense ANSWER A
Which account should NOT be included in the asset section of a central bank balance sheet? A) currency in circulation B) official international reserves C) domestic credit D) government bonds ANSWER Answer: A
The ________ on an asset is the expected return on the asset in excess of the return on a risk-free asset. A) risk premium B) covariance C) systematic risk D) beta ANSWER Answer: A
Official international reserves consist of three major components EXCEPT: A) gold reserves. B) foreign exchange reserves. C) deposits of private financial institutions. D) IMF-related reserves assets. ANSWER Answer: C
The special drawing rights of the IMF and the European currency unit are two examples of ________. A) currency boards B) floating exchange rates C) target zones D) baskets of currencies ANSWER Answer: D
What is the name for the set of regulations pertaining to flows of capital into and out of a country? A) capital controls B) target zone system C) crawling peg D) lead-lag operations ANSWER Answer: A
What is the name for the composite currency that consists of various units of other currencies? A) pegged currency B) seignorage C) basket of currency D) special drawing rights ANSWER Answer: C
