13- International Banking Offices can be formed as.... 1. Correspondent bank 2. Representative office 3. Foreign Branch 4. Subsidiary and Affiliate Bank A) Only 1 B) Only 1 and 2 C) 1,2,3,4 D) Only 1,23 14- Which of the statement is defined false A) Bank capital adequacy is the equity capital and other securities a bank holds as reserves against risky assets B) It shows how much bank capital is "enough" to ensure the safety and soundness of the banking system C) Minimum Capital Adequacy is 8% multiply by risk weighted assets D) Higher capital ratios should incentivise shareholders to monitor managers to take low risk-taking 15- Which of the statement is not true for International Bonds A) Foreign Bond is issued by a foreign borrower to investors in another country and denominated in the currency of that country. Investors view it as a debt instrument issued by a foreign instead of a domestic borrower. B) Eurobond is denominated in a specific currency, but sold to investors in a national capital market other than the country of the denominated currency. C) Eurobonds can be zero coupon bonds D) None of the statement is false 16- Which of the following best describes the Floating-Rate Notes (FRN) A) FRNs are typically medium term bonds with coupon payments indexed to some reference rate. B) FRN coupon payments are fixed C) FRN allow the holder to surrender his bond in exchange for a specified number of shares in the firm of the issue D) All of the statement is false 17- Which of the following represents primary markets? A) The options markets B) Stock Exchange Markets C) IPO's (Initial Public Offering) D) None of these A) is linked to inflation rate B) is linked to libor C) is linked to appreciation rate of a different currency D) has a fixed interest rate 19. Which of the following best describes the ZERO COUPON BONDS A) Zeros are sold at a large discount from face value because there is no cash flow until maturity There are coupon payments Interest rate cab be paid during the maturity All of the statement is false 3 18-Straight Fixed Rate Debt. B) C) D)