Zero-balance accounts are checking accounts in which a zero balance is maintained and the bank automatically covers all checks presented against the accounts. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Federal agency issues are low-risk securities issued by government agencies but not guaranteed by the U.S. Treasury. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Eurodollar deposits are deposits of currency that are not native to the country in which the bank is located. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
To be truly marketable, a security must have three basic characteristics: a ready market, risk-free, and safety of principal. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Marketable securities are short-term, interest-earning, money market instruments that can easily be converted into cash. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
A lockbox system is used to reduce collection float by shortening all three basic float components (i.e., mail, processing, and clearing). Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
The peso problem got its name during the period 1955-1976 when the ________ authorities were attempting to peg the peso-dollar exchange rate. A) Argentine B) Brazilian C) Mexican D) Honduran ANSWER Answer: C
Date: September 19th, 2020
A phenomenon known as ________ arises when rational investors anticipate events that do not with the frequency that the investors expect. A) interest rate parity B) the peso problem C) rational expectations D) purchasing power parity ANSWER Answer: B
Date: September 19th, 2020
Which one of the following is the only determinant of volatility in the forward currency markets? A) interest rate parity B) economic recovery C) political turmoil D) variance of the future exchange rates ANSWER Answer: D
Date: September 19th, 2020
Regression tests of the unbiasedness hypothesis indicate that it is ________ with real life events. A) an unbiased indicator of expected future exchange rates B) very consistent C) not consistent D) has a strong correlation to the current account ANSWER Answer: C
Date: September 19th, 2020
