CHAPTER 2: THE DOMESTIC AND INTERNATIONAL FINANCIAL MARKETPLACE A multinational firm . hasdirectinvestmentsinmanufacturingfacilitiesinmorethanonecountry exportsfinishedgoodsforsaleinanothercountry importsrawmaterialsfromanothercountry hasamanufacturingrepresentativeinanothercountry a ANSWER: Thedifferencebetweenmerchandiseexportsandimportsisknownasthe . transactionexposure differenceinpurchasingpower goodsandservicestradebalance import/exportreserve c ANSWER: TheinterestrateatwhichbanksintheEurocurrencymarketlendtoeachotherisknownasthe . Eurocurrencycurrencyrate(ECR) Londoninterbankofferrate exchangerate interestrateparity b ANSWER: Anexchangeratequotedas$1.47perBritishpoundisknownasa quote. direct futures indirect b ANSWER: IfJapaneseyenaredepositedinabankinParis,thedepositswouldbecalled Eurofrancs EuropeanCurrencyUnit Eurobond Euroyen d ANSWER: strengthenrelativetothedollar weakenrelativetotheECU
CHAPTER 2: THE DOMESTIC AND INTERNATIONAL FINANCIAL MARKETPLACE A multinational firm . hasdirectinvestmentsinmanufacturingfacilitiesinmorethanonecountry exportsfinishedgoodsforsaleinanothercountry importsrawmaterialsfromanothercountry hasamanufacturingrepresentativeinanothercountry ANSWER: a Thedifferencebetweenmerchandiseexportsandimportsisknownasthe . transactionexposure differenceinpurchasingpower goodsandservicestradebalance import/exportreserve ANSWER: c TheinterestrateatwhichbanksintheEurocurrencymarketlendtoeachotherisknownasthe . Eurocurrencycurrencyrate(ECR) Londoninterbankofferrate exchangerate interestrateparity ANSWER: b Anexchangeratequotedas$1.47perBritishpoundisknownasa quote. direct futures indirect ANSWER: b IfJapaneseyenaredepositedinabankinParis,thedepositswouldbecalled Eurofrancs EuropeanCurrencyUnit Eurobond Euroyen ANSWER: d strengthenrelativetothedollar weakenrelativetotheECU
Test-Bank-Contemporary-Financial-Management-13th-Edition-Moyer.docx