1) The balance of payments a. Determines the eligibility of countries for IMF aid. b. Adds up the value of all assets and liabilities of a country on a specific date. c. Records all international transactions for a country over a period of time. d. All of the above. 2) If the current exchange rate is 124 Japanese yen per U.S. dollar, the price of a Big Mac hamburger in the United States is $2.54, and the price of a Big Mac hamburger in Japan is 294 yen, then other things equal, the Big Mac hamburger in Japan is a. Correctly priced b. Under priced c. Over priced d. None of the above. 3) Which of the following is necessary for the calculation if the forward rate? a. The spot rate b. The foreign currency deposit rate c. The home currency deposit rate d. All of the above 4) A forward contract to deliver British pounds for US dollar could be described either as: a. Buying dollars forward; buying pounds forward b. Selling pounds forward; selling dollars forward c. Selling pounds forward; buying dollars forward d. Selling dollars forward; buying pounds forward 5) Which of the following is NOT one of the three categories reported for foreign exchange? a. Spot transactions b. Swap transactions c. Strip transactions d. Future transactions 6) A foreign currency contract that calls for the future delivery of a standard amount of foreign exchange at a fixed time, place & price is called: a. Futures b. Forward c. Option