The most likely way for the Japanese to reduce a trade surplus is to A) revalue the Japanese yen. B) impose quotas on imports from Japan. C) boost Japanese savings. D) boost Japanese consumption abroad. ANSWER Answer: D
Date: September 19th, 2020
If a nation’s income exceeds its spending, then A) savings will exceed domestic investment. B) the nation must run a current account surplus. C) the nation must run a capital account deficit. D) all of the above. ANSWER Answer: D
Date: September 19th, 2020
The ________ is a snapshot of the firm at a particular point in time. A) income statement B) statement of cash flows C) statement of retained earnings D) balance sheet E) None of the above ANSWER D
Date: September 19th, 2020
The amount of foreign currency that one U.S. dollar will buy is called the A) base rate. B) counter rate. C) indirect rate. D) direct rate. E) forward rate. ANSWER C
Date: September 19th, 2020
Persistent, large current account deficits are often associated with currency crises for floating rate currencies in which the currency with the crisis ________ substantially. A) appreciates B) devaluates C) depreciates D) revaluates ANSWER Answer: C
Date: September 19th, 2020
Forward transactions A) seldom benefit manufacturing firms. B) typically only enable the buyer of the forward contract to benefit from favorable exchange rate changes, but not the seller. C) are widely used to reduce exchange rate risk. D) are processed by dealers, but seldom by money-center banks. E) are executed in spot markets. […]
Date: September 19th, 2020
In a freely floating exchange rate system, the sale of Japanese cars to the United States will be offset by which item on the US balance of payments? A) a credit on the current account B) a credit on the capital account C) a debit on the trade account D) A or B […]
Date: September 19th, 2020
Ewing Oil repurchased $5.10B worth of shares during the year at an average price of $30. Cliff Barnes owned 0.15B shares in Ewing prior to the repurchase. Cliff decided not to sell any shares during the repurchase. What was Cliff’s proportionate ownership in Ewing following the repurchase? Ewing Oil Inc Selected Financial Information Shares outstanding […]
Date: September 19th, 2020
Purchases and sales of foreign assets by domestic residents would appear in the ________ account of the balance of payments. A) current B) capital C) trade merchandise D) official settlement ANSWER Answer: B
Date: September 19th, 2020
Dinder Mufflin is a Pennsylvania-based paper company. Dinder Mufflin is all equity financed. Its shares are trading for $7.67 and it has 433 million shares outstanding. The company has excess cash of $831.36 million that it wants to distribute using a fixed-price tender offer. It has announced that it will pay $9.60 per share and […]
Date: September 19th, 2020
