InternationalFinancialManagement_5thEd_Eun_TestBank13

InternationalFinancialManagement_5thEd_Eun_TestBank13 - 13...

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13 Student: ___________________________________________________________________________ 1. The sale of new common stock by corporations to initial investors occurs in A. The primary market B. The secondary market C. The OTC market D. The dealer market 2. The sale of previously issued common stock traded between investors occurs in A. The primary market B. The secondary market C. The on-the-run market D. The dealer market 3. A "primary" stock market is A. A big internationally-important market like the NYSE B. A market where corporations issue new shares to initial investors C. Where brokers and market makers trade D. None of the above 4. The market capitalization of the developed world A. Is about 90 percent of the market cap of the entire world B. Is about 80 percent of the market cap of the entire world C. Is about 70 percent of the market cap of the entire world D. Is about 60 percent of the market cap of the entire world 5. The market capitalization of the developing world A. Is about 80 percent of the market cap of the entire world B. Is about 60 percent of the market cap of the entire world C. Is about 40 percent of the market cap of the entire world D. Is about 20 percent of the market cap of the entire world 6. In general, Standard & Poor's Emerging Markets Data Base classified a stock market as "emerging" if A. It is located in a low- or middle-income economy as defined by the World Bank B. Its investable market capitalization is low relative to its most recent GNI figures C. a) or b) D. none of the above 7. Investment in foreign equity markets A. Is a real "backwater" in finance B. Became common practice in the 1980s as investors diversified their portfolios. C. During the 1980s was largely confined to the developed world D. All of the above 8. During the 1980s, cross-border equity investment was largely confined A. To the equity markets of developed countries. B. To the emerging equity markets. C. To the equity markets of the former Soviet Union. D. None of the above 9. In mutual funds, investment in emerging foreign equity markets A. Represents less than one percent of investments in U.S.-based mutual funds. B. Represents about five percent of investments in U.S.-based mutual funds. C. Represents more than twenty percent of investments in U.S.-based mutual funds. D. Declined during the 1990s
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10. Only in _______ did world investors start to invest sizable amounts in the emerging equity markets, as the economic growth and prospects of the developing countries improved. A. The 1960s B. The 1970s C. The 1980s D. The 1990s 11. Which investment is likely to be the most liquid: A. A share of publicly traded company trading on the NYSE. B. A bond issued by a Fortune 500. company. C. A house in a nice part of town.
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