1.Which one of the following fulfills the purpose of a national capitalmarket?

(a)To minimize the risk of financial losses to lenders due to poor management decisions

(b)To enable lenders to take advantage of bankruptcy laws

(c)To provide a mechanism to invest money efficiently

(d)To provide services across national borders

(e)To allow lenders to write off bad debts on their tax returns

2.Which one of the following is a purpose of the international capitalmarket?

(a)Reducing return on investment

(b)Increasing the cost of consumer loans

(c)Offering loans to borrowers in developing nations

(d)Maximizing dividends to stockholders

(e)Expanding the money supply

3.Which one of the following is a source of deposits for the Euro currencymarket?

(a)Governments that need to borrow funds

(b)Extremely wealthy countries

(c)Smallcompanies, banks, and governments

(d)International companies with excess cash

(e)Commercial banks on behalf of exporters and importers

4.Which one of the following is responsible for growth in the international equitymarket?

(a)Spread of privatization

(b)Interest rates

(c)Activity of commercial banks

(d)Activity in commodity markets

(e)Economic growth in developed countries

5.Which one of the following is an appeal of the Euro currencymarket?

(a)Greater risk

(b)Lower risk of default

(c)Access to foreign stock markets

(d)Complete absence of regulation

(e)Lower taxes for banks and investors

6.Which one of the following is a characteristic ofmicro finance?

(a)Microloans require collateral equal to the amount of the loan.

(b)Loans must be at least$50,000.

(c)Micro finance lends money tolow-income entrepreneurs at high interest rates.

(d)Most borrowers are women.

(e)Microloans are illegal in developed countries.

7.Which one of the following is a function of the foreign exchangemarket?

(a)Equity financing

(b)Inter bank interest rates

(c)Making microloans

(d)Currency conversion

(e)Savings at interest