国际金融FinanceTestBank4Word文档下载推荐.docx

1、SOLUTION:（$0.73 $0.69）/$0.69 = 5.80%PTS: 1 2. If a currencys spot rate market is _, its exchange rate is likely to be _ to a single large purchase or sale transaction.liquid; highly sensitiveilliquid; insensitivenone of the above. C PTS: 3. _ is not a factor that causes currency supply and demand sc

2、hedules to change.Relative inflation ratesRelative interest ratesRelative income levelsExpectationse.All of the above are factors that cause currency supply and demand schedules to change. E PTS: 4. A large increase in the income level in Mexico along with no growth in the U.S. income level is norma

3、lly expected to cause （assuming no change in interest rates or other factors） a（n） _ in Mexican demand for U.S. goods, and the Mexican peso should _.increase; appreciate depreciatedecrease; B PTS: 5. An increase in U.S. interest rates relative to German interest rates would likely _ the U.S. demand

4、for euros and _ the supply of euros for sale.reduce; increase reduce A PTS: 6. Investors from Germany, the United States, and the U.K. frequently invest in each other based on prevailing interest rates. If British interest rates increase, German investors are likely to buy _ dollar-denominated secur

5、ities, and the euro is likely to _ relative to the dollar.fewer;more; 7. When the real interest rate is relatively low in a given country, then the currency of that country is typically expected to be:weak, since the countrys quoted interest rate would be high relative to the inflation rate.strong,

6、since the countrys quoted interest rate would be low relative to the inflation rate. D PTS: 8. Assume that the inflation rate becomes much higher in the U.K. relative to the U.S. This will place _ pressure on the value of the British pound. Also, assume that interest rates in the U.K. begin to rise

7、relative to interest rates in the U.S. The change in interest rates will place _ pressure on the value of the British pound.upward; downward upwarddownward; 9. In general, when speculating on exchange rate movements, the speculator will borrow the currency that is expected to appreciate and invest i

8、n the country whose currency is expected to depreciate.a. Trueb. False F PTS: 10. Baylor Bank believes the New Zealand dollar will appreciate over the next five days from $.48 to $.50. The following annual interest rates apply:CurrencyLending RateBorrowing RateDollars7.10%7.50%New Zealand dollar （NZ

9、$）6.80%7.25%Baylor Bank has the capacity to borrow either NZ$10 million or $5 million. If Baylor Banks forecast is correct, what will its dollar profit be from speculation over the five-day period （assuming it does not use any of its existing consumer deposits to capitalize on its expectations）?$521

10、,325.$500,520.$104,262.$413,419.$208,044. E1.Borrow $5 million.2.Convert to NZ$: $5,000,000/$.48 = NZ$10,416,667.3.Invest the NZ$ at an annualized rate of 6.80% over five days. NZ$10,416,667 1 + 6.80% （5/360） = NZ$10,426,5054.Convert the NZ$ back to dollars: NZ$10,426,505 $.50 = $5,213,2525.Repay th

11、e dollars borrowed. The repayment amount is: $5,000,000 1 + 7.5% （5/360） = $5,000,000 1.00104 = $5,005,2086.After repaying the loan, the remaining dollar profit is: $5,213,252 $5,005,208 = $208,044 11. Assume the following information regarding U.S. and European annualized interest rates:U.S. Dollar

12、 （$）6.73%7.20%Euro （）7.28%Trensor Bank can borrow either $20 million or 20 million. The current spot rate of the euro is $1.13. Furthermore, Trensor Bank expects the spot rate of the euro to be $1.10 in 90 days. What is Trensor Banks dollar profit from speculating if the spot rate of the euro is ind

13、eed $1.10 in 90 days?$579,845.$583,800.$588,200.$584,245.$980,245. ABorrow 20 million.Convert the 20 million to 20,000,000 $1.13 = $22,600,000.Invest the $22,600,000 at an annualized rate of 6.73% for 90 days. $22,600,000 1 + 6.73% （90/360） = $22,980,245Determine euros owed: 20,000,000 1 + 7.28% （90

14、/360） = 20,364,000.Determine dollars needed to repay euro loan: 20,364,000 $1.10 = $22,400,400.The dollar profit is $22,980,245 $22,400,400 = $579,845. 12. The equilibrium exchange rate of pounds is $1.70. At an exchange rate of $1.72 per pound:U.S. demand for pounds would exceed the supply of pound

15、s for sale and there would be a shortage of pounds in the foreign exchange market.U.S. demand for pounds would be less than the supply of pounds for sale and there would be a shortage of pounds in the foreign exchange market.U.S. demand for pounds would exceed the supply of pounds for sale and there

16、 would be a surplus of pounds in the foreign exchange market.U.S. demand for pounds would be less than the supply of pounds for sale and there would be a surplus of pounds in the foreign exchange market.U.S. demand for pounds would be equal to the supply of pounds for sale and there would be a short

17、age of pounds in the foreign exchange market. 13. Assume that Swiss investors have francs available to invest in securities, and they initially view U.S. and British interest rates as equally attractive. Now assume that U.S. interest rates increase while British interest rates stay the same. This wo

18、uld likely cause:the Swiss demand for dollars to decrease and the dollar will depreciate against the pound.the Swiss demand for dollars to increase and the dollar will depreciate against the Swiss franc.the Swiss demand for dollars to increase and the dollar will appreciate against the Swiss franc.t

19、he Swiss demand for dollars to decrease and the dollar will appreciate against the pound. 14. The real interest rate adjusts the nominal interest rate for:exchange rate movements.income growth.inflation.government controls.none of the above 15. If U.S. inflation suddenly increased while European inf

20、lation stayed the same, there would be:an increased U.S. demand for euros and an increased supply of euros for sale.a decreased U.S. demand for euros and an increased supply of euros for sale.a decreased U.S. demand for euros and a decreased supply of euros for sale.an increased U.S. demand for euro

21、s and a decreased supply of euros for sale. 16. If inflation in New Zealand suddenly increased while U.S. inflation stayed the same, there would be:an inward shift in the demand schedule for NZ$ and an outward shift in the supply schedule for NZ$.an outward shift in the demand schedule for NZ$ and a

22、n inward shift in the supply schedule for NZ$.an outward shift in the demand schedule for NZ$ and an outward shift in the supply schedule for NZ$.an inward shift in the demand schedule for NZ$ and an inward shift in the supply schedule for NZ$. 17. If the U.S. and Japan engage in substantial financi

23、al flows but little trade, _ directly influences their exchange rate the most. If the U.S. and Switzerland engage in much trade but little financial flows, _ directly influences their exchange rate the most.interest rate differentials; interest rate differentialsinflation and interest rate different

24、ials;income and interest rate differentials; inflation differentials inflation and income differentialsinflation and income differentials; 18. If inflation increases substantially in Australia while U.S. inflation remains unchanged, this is expected to place _ pressure on the value of the Australian

25、 dollar with respect to the U.S. dollar.upwarddownwardeither upward or downward （depending on the degree of the increase in Australian inflation）none of the above; there will be no impact 19. Assume that British corporations begin to purchase more supplies from the U.S. as a result of several labor

26、strikes by British suppliers. This action reflects:an increased demand for British pounds.a decrease in the demand for British pounds.an increase in the supply of British pounds for sale.a decrease in the supply of British pounds for sale. 20. The exchange rates of smaller countries are very stable because the market for their currency is very liquid. 21. The phrase the dollar was mixed in trading means that:t