BUSI 604BUSI 604 - Test 2 required for easier passing of exams

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 Question 1 2 out of 2 points OTC participants trade on a physical trading floor. Selected Answer: Fals e  Question 2 2 out of 2 points (___________) is considered a sign of economic re ... covery and stabilization but makes the currency of a country more expensive compared to other currencies, having a direct inverse effect on exports and imports. Selected Answer: Revaluati on  Question 3 0 out of 2 points Purchasing Power Parity has an impact on exchange rates and indicates the current level of inflation of one currency against another. Selected Answer: Fals e  Question 4 2 out of 2 points Eurocurrency and Eurobanks do not necessarily mean the currencies or the banks are European. Selected Answer: Tru e  Question 5 2 out of 2 points Speculation generally means buying a commodity when its price is low and then reselling it after prices rise in order to make a profit. Selected Answer: Fals e  Question 6 0 out of 2 points A large percentage of all FX market transactions are spot transactions. Selected Answer: Fals e  Question 7 2 out of 2 points The end result of the global competition is higher (_______) and lower (_________) for consumers. Selected Answer: quality products; prices  Question 8 2 out of 2 points A simpler way to calculate purchasing power parity between two countries is to compare the price of a (________) good that is in fact identical across countries. Selected Answer: Standa rd  Question 9 2 out of 2 points The (___________) monitors the various companies and organizations that are quoted on the security exchange and make sure they meet the requirements for being listed. Selected Answer: Securities Exchange Commission  Question 10 2 out of 2 points Global financial markets are important to borrowers for two reasons such as (1) to expand the supply of money, and (2) reduce the cost of money. Selected Answer: Tru e  Question 11 0 out of 2 points The role of the World Bank is to supervise the exchange rate practices of member countries and to encourage the free convertibility of any national money into the monies of other countries. Selected Answer: Tru e  Question 12 2 out of 2 points The difference between a (_______) rate and a (________) rate is termed a forward discount. Selected Answer: spot and forward  Question 13 2 out of 2 points A currency board is a government’s bank and is capable of bailing out a failing bank. Selected Answer: Fals e  Question 14 2 out of 2 points The majority of transactions on the FX include operations with (_________), where one party sells or buys dollars using other world currencies. Selected Answer: the U.S. Dollar  Question 15 2 out of 2 points (__________) essentially decreases a consumer’s purchasing power by making goods and services more expensive. Selected Answer: Inflati on  Question 16 2 out of 2 points If a currency price is expected to rise in the future, a buyer pays a higher price, which is considered a forward discount. Selected Answer: Fals e  Question 17 0 out of 2 points In the United States, the (____________) is responsible for regulating the growth of the economy. Selected Answer: Global Financial Market  Question 18 2 out of 2 points (________) and (_________) quotation are also referred to as American and European Quotes. Selected Answer: direct and indirect  Question 19 2 out of 2 points All EU members are obliged to adopt the Euro as their national currency, with the exception of Great Britain and France. Selected Answer: Fals e  Question 20 0 out of 2 points The objective of the OECD is increasing economic welfare through the world by covering issues associated with social work and economic efforts within participating governments and nonparticipating governments. Selected Answer: Tru e  Question 21 0 out of 2 points Oil prices are set by OPEC. Selected Answer: Tru e  Question 22 2 out of 2 points The main objective of one of the trade organizations in Africa, (________), was to integrate economies and partake in shared development of economic growth. Selected Answer: Economic Community of West African States  Question 23 2 out of 2 points The Schengen Agreement abolished passport and border controls within the internalnational boundaries of the (_______). Selected Answer: European Union  Question 24 2 out of 2 points Agreements between participating nations are managed and promoted through (__________). Selected Answer: Trading blocs  Question 25 2 out of 2 points History has displayed how conflicts can affect the supply and demand of oil resources, resulting in (______) fluctuation. Selected Answer: Pric e  Question 26 2 out of 2 points In a (_______) union, members have the same rights as in a free trade area, with the exception that they will now all have the same trade policy towards nonmembers. Selected Answer: Custo ms  Question 27 2 out of 2 points The Council of Europe judges claims by member states that the European Commission has exceeded its authority. Selected Answer: Fals e  Question 28 [Show More]

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