chap022+practice

chap022+practice - CHAPTER 22 International Corporate...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
CHAPTER 22 International Corporate Finance CROSS-RATE b 2. The implicit exchange rate between currencies found from explicit exchange rates quoted in some third currency is called a(n) . a. open exchange rate b. cross-rate c. backward rate d. forward rate e. interest rate LONDON INTERBANK OFFER RATE b 7. The rate most international banks charge one another for overnight Eurodollar loans is called the . a. Eurodollar yield to maturity b. London Interbank Offer Rate c. Paris Opening Interest Rate d. United States Treasury Bill Rate e. International Prime Rate FORWARD TRADE b 12. An agreement to exchange currencies at some point in the future using an agreed-upon exchange rate is called a trade. a. spot b. forward c. swap d. floating e. triangle FORWARD EXCHANGE RATE c 13. The agreed-upon exchange rate used in a forward trade is called the exchange rate. a. spot b. swap c. forward d. parity e. triangle PURCHASING POWER PARITY d 14. The notion that exchange rates adjust to keep the purchasing power of a currency constant across countries is called: a. The unbiased forward rates condition. b. Uncovered interest rate parity. c. The international Fisher effect. d. Purchasing power parity. e. Interest rate parity. INTEREST RATE PARITY
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
CHAPTER 22 e 15. The condition that relates interest rate differentials between countries to the percentage difference between their forward and spot exchange rates is called: a. The unbiased forward rates condition. b. Uncovered interest rate parity. c. The international Fisher effect. d. Purchasing power parity. e. Interest rate parity. UNCOVERED INTEREST RATE PARITY b 17. The condition stating that the expected percentage change in the exchange rate is equal to the difference in interest rates between the two countries is called: a. The unbiased forward rates condition. b.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 5

chap022+practice - CHAPTER 22 International Corporate...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online