1). What factors are atfecting international trade fiow of country a) nationial income b) government restrictions c) exchange rates d) all the above 2) Which of the following is true: a) Demand for a currency increases when the value of the currency decreases, teading to a downward sloping demand schedule. b) Supply of a currency for sale increases when the value of the currency incteases, leading to an downward sloping supply scheoulo. c) Demand for a currency decreases when the value of the cuirency decreases, leading to a downward sloping demand schedule. d) Suppiy of a currency for sale decreases when the value of the currency increases, leading to an upward sloping supply schedile. 3) in covered interest arbilrage the % of forward premium should bo equal to % of intorest dilferential True False 4) in general terms, the forward rate of the foreign currency will NOT contain a discount (premium) if its interest rate is higher fower) than the U.S. interest rate. True False 5) In an interest rate parity lne graph, the space above the neutral band represents captal outhows. True False 6) Managers of MNCs are expected to make decisions that will maximize the stock prico, and thus sorvo tharehoider interest True False 7) How does uncertainty atlect the MNCss cost of capitar? a) A higher level of uncertainty decreases the return on investment required by investors and thel Mnsc's valuation decreases. b) A higher level of uncertainty increases the return on investment required by irvestors and the MNo's valuation decreases. c) A thigher level of uncertainty increases the roturn on investment required by investors and the MNC's valuation increases. d) none of the above