Question
1- increasing Hedging acivities by MNE will most likely results into O A. lower risk but lower cash flow O B. higher risk and higher
1- increasing Hedging acivities by MNE will most likely results into O A. lower risk but lower cash flow
O B. higher risk and higher cash flow.
O C. higher risk and lower cash flow
O D. lower risk and higher cash flow.
2- What determinant make the MNE to choose whether to hedge or not.
A. risk tolerance.
B. viewpoint.
O C.A &B
O D. non of the above.
QUESTION 3
when a subsidery (owned by foreign parent MNE) value its principles relative to its local currency on its financial statment, this firm is considered
O A. translated Foreign Entity.
O B. Integrated Foreign Entity.
O C. non-translated Foreign Entity.
O D. Self-sustaining Foreign Entity.
QUESTION 4
under current rate method, any gain or losses will be written as translation adjustment on which of the following financial statment?
O A. all of them.
O B. Balance sheet.
O C. Income statement.
O D. cash flow statement.
QUESTION 5
Balance sheet hedge is an equal amount of exposed level of foreign assets and liabilities because
O A. level of risk would decrease since exchange rate would be stable even on the event of high movement of exchange rate.
O B. when exchange rate fluctuated, risk associated with change in liabilities would be offset by the same amount of assets.
O C. the level of fluctuation would be lowere when assets equal liabilities
O D. working capital will increase.
QUESTION 6
CAPM can be used by MNE to
O A. estimate its cost of equity.
O B. estimate its revenues.
- C. estimate its return.
- D. estimate its debt cost.
QUESTION 7
Slutz (1995) suggest using
O A. local, small.
O B. global, small
O C. global, large.
O D. local, small.
Question 8
The problem with calculating using cost of equity is
- A. they are using historical values where they should be instead forward looking
- B. There is a mrgin of error.
- C. there is a probaility of becoming higher cost than other firms on the industry.
O D. There might be lower excess returns.
QUESTION 9
Assuming there is fixed capital structue (debt and equity), local cost of capital is expected to increase as a result of increase on
on local capitall market,
thus MNE has a
relative to local firms since they are exposed to interenaional capital market and hence lower cost of capital.
- A. supply, higher opportunity cost.
- B. supply, comparative advantage.
O C. demand, higher opportunity cost.
O D. demand, competitive advantage.
QUESTION 9
Assuming there is fixed capital structue (debt and equity), local cost of capital is expected to increase as a result of increase on
on local capitall market,
thus MNE has a
relative to local firms since they are exposed to interenaional capital market and hence lower cost of capital.
- A. supply, higher opportunity cost.
- B. supply, comparative advantage.
O C. demand, higher opportunity cost.
O D. demand, competitive advantage.
QUESTION 10
for capital structure of MNE, increasing equity usually started
A. Localy.
O B. internationally
- C. both local & international capitals
- D. it depends on exchange rates.
Question 11 American MNE will be able to increase its equity internationally through
O A. sponsored GDR.
O B. Sponsored ADR.
O C. unsponsored ADR.
O D. unsponsored GDR.
QUESTION 12
which of following ADR is traded only OTC since it has lower requirements by SEC?
A. Level 3 ADR.
O B. Level 1 ADR.
O C. Level 4 ADR.
O D. Level 2 ADR.
QUESTION 13
A Euroequity is an IPO
A. on American exchanges but traded on Euro currency.
O B. on multiple exchanges in multiple countries at the same time but traded on Euro currency.
O C. on multiple European exchanges at the same time.
O D. on multiple exchanges in multiple countries (European and non European) at the same time.
QUESTION 14
When an investment bank is unable to provide credit to a single firm (whether because of the nature of the firm, the credit provided is large or unforeseen factors), the credit can be provided as O A. Syndicated credit.
O B. private placements.
O C. money market.
D. short term loans
QUESTION 15
There is high risk for MNE since 2020 (COVID19, Russia-Ukrain war, global recession and so on), these risks are considered
O A. global specific risks.
B. firm specific risk.
O C. country specific risk.
D. both country and global specific risks.
QUESTION 16
When an investor increases his/her portfolio by international portfolio, this activity can most likely be justified by O A. reducing systmetic risks.
B. reducing nonsystmetic risks.
O C. reducing firm specific risk.
O D. reducing diversifiable risks.
QUESTION 17
Using the following information to calculate Sharpe ratio return is 15% stanadard deviation is 10%.
risk-free return is 5% beta is 1.25
O A.1
O B. 0.08
O C. 1.5
O D. 1.25
QUESTION 18
which of the following events will disrupt cpaital structure for a parent company
O A. government subsidy.
O B. tax reforms.
O C. all of the above
O D. none of the above.
QUESTION 19
Which of the following is not considered as a setttelment for Acquisition?
O poision pill
O Friendly takeover.
O Hostile takeover
O Compensation using cash
QUESTION 20
why a firm acquire an international firm?
A. reduce uncertainty.
O B. economy of scales.
O C. poision bills.
O D. white knight.
O A. lower risk but lower cash flow
O B. higher risk and higher cash flow.
O C. higher risk and lower cash flow
O D. lower risk and higher cash flow.
2- What determinant make the MNE to choose whether to hedge or not.
A. risk tolerance.
B. viewpoint.
O C.A &B
O D. non of the above.
QUESTION 3
when a subsidery (owned by foreign parent MNE) value its principles relative to its local currency on its financial statment, this firm is considered
O A. translated Foreign Entity.
O B. Integrated Foreign Entity.
O C. non-translated Foreign Entity.
O D. Self-sustaining Foreign Entity.
QUESTION 4
under current rate method, any gain or losses will be written as translation adjustment on which of the following financial statment?
O A. all of them.
O B. Balance sheet.
O C. Income statement.
O D. cash flow statement.
QUESTION 5
Balance sheet hedge is an equal amount of exposed level of foreign assets and liabilities because
O A. level of risk would decrease since exchange rate would be stable even on the event of high movement of exchange rate.
O B. when exchange rate fluctuated, risk associated with change in liabilities would be offset by the same amount of assets.
O C. the level of fluctuation would be lowere when assets equal liabilities
O D. working capital will increase.
QUESTION 6
CAPM can be used by MNE to
O A. estimate its cost of equity.
O B. estimate its revenues.
- C. estimate its return.
- D. estimate its debt cost.
QUESTION 7
Slutz (1995) suggest using
O A. local, small.
O B. global, small
O C. global, large.
O D. local, small.
Question 8
The problem with calculating using cost of equity is
- A. they are using historical values where they should be instead forward looking
- B. There is a mrgin of error.
- C. there is a probaility of becoming higher cost than other firms on the industry.
O D. There might be lower excess returns.
QUESTION 9
Assuming there is fixed capital structue (debt and equity), local cost of capital is expected to increase as a result of increase on
on local capitall market,
thus MNE has a
relative to local firms since they are exposed to interenaional capital market and hence lower cost of capital.
- A. supply, higher opportunity cost.
- B. supply, comparative advantage.
O C. demand, higher opportunity cost.
O D. demand, competitive advantage.
QUESTION 9
Assuming there is fixed capital structue (debt and equity), local cost of capital is expected to increase as a result of increase on
on local capitall market,
thus MNE has a
relative to local firms since they are exposed to interenaional capital market and hence lower cost of capital.
- A. supply, higher opportunity cost.
- B. supply, comparative advantage.
O C. demand, higher opportunity cost.
O D. demand, competitive advantage.
QUESTION 10
for capital structure of MNE, increasing equity usually started
A. Localy.
O B. internationally
- C. both local & international capitals
- D. it depends on exchange rates.
American MNE will be able to increase its equity internationally through
O A. sponsored GDR.
O B. Sponsored ADR.
O C. unsponsored ADR.
O D. unsponsored GDR.
QUESTION 12
which of following ADR is traded only OTC since it has lower requirements by SEC?
A. Level 3 ADR.
O B. Level 1 ADR.
O C. Level 4 ADR.
O D. Level 2 ADR.
QUESTION 13
A Euroequity is an IPO
A. on American exchanges but traded on Euro currency.
O B. on multiple exchanges in multiple countries at the same time but traded on Euro currency.
O C. on multiple European exchanges at the same time.
O D. on multiple exchanges in multiple countries (European and non European) at the same time.
QUESTION 14
When an investment bank is unable to provide credit to a single firm (whether because of the nature of the firm, the credit provided is large or unforeseen factors), the credit can be provided as O A. Syndicated credit.
O B. private placements.
O C. money market.
D. short term loans
QUESTION 15
There is high risk for MNE since 2020 (COVID19, Russia-Ukrain war, global recession and so on), these risks are considered
O A. global specific risks.
B. firm specific risk.
O C. country specific risk.
D. both country and global specific risks.
QUESTION 16
When an investor increases his/her portfolio by international portfolio, this activity can most likely be justified by O A. reducing systmetic risks.
B. reducing nonsystmetic risks.
O C. reducing firm specific risk.
O D. reducing diversifiable risks.
QUESTION 17
Using the following information to calculate Sharpe ratio return is 15% stanadard deviation is 10%.
risk-free return is 5% beta is 1.25
O A.1
O B. 0.08
O C. 1.5
O D. 1.25
QUESTION 18
which of the following events will disrupt cpaital structure for a parent company
O A. government subsidy.
O B. tax reforms.
O C. all of the above
O D. none of the above.
QUESTION 19
Which of the following is not considered as a setttelment for Acquisition?
O poision pill
O Friendly takeover.
O Hostile takeover
O Compensation using cash
QUESTION 20
why a firm acquire an international firm?
A. reduce uncertainty.
O B. economy of scales.
O C. poision bills.
O D. white knight.
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Corporate And Project Finance Modeling Theory And Practice
Authors: Edward Bodmer
1st Edition
1118854365, 9781118854365
