19. Private equity funds tend to use mostly when acquiring stakes in businesses. a. their equity from issuing common stock b. their equity from retaining carnings c. their equity from issuing preferred stock d. borrowed funds 20. At any given point in time, the price at which banks will buy a currency is the price at which they sell it a. higher than b. lower than c. the same as d. None of the above. 21. A system whereby exchange rates are market determined without boundaries but subject to government intervention is called a. a dirty float. b. a free float. c. the gold standard. d. the Bretton Woods era. e. None of the above. 22. Purchasing power parity suggests that the exchange rate will on average change by a percentage that reflects the differential between two countries. a. Income h. interest rate c. inflation d. tax e. None of the above. 23. In the Wall Street Journal, you observe that the British pound (E) is quoted at $1.65. The Australian dollar (AS) is quoted at S0.60. What is the value of one Australian dollar in British pounds? a. A$2.75 b. A$0.36 c. 2.75 d. 0.36 e. None of the above. 24. If the quoted cross-exchange rate between two foreign currencies is not aligned with the two corresponding exchange rates, investors can profit from triangular arbitrage. a. True b. False 25. The forward rate is the exchange rate for immediate delivery a. True b. False