26. Historically, global investors are attracted to the Eurobond market because: a. It offers longer term maturity instruments than domestic markets b. It operates in Europe and the US c. It offers bearer form instruments d. It offers registered form instruments e. It offers medium- and long-term instruments 27. The DoDo Bird Co., a U.S.-based MNC has applied the following regression model to estimate the sensitivity of its cash flows to exchange rate movements PCFt=a0+bset+ut Where the term on the left hand-side is the percentage change in the inflation adjusted cash flows measured in U.S. dollars over period t and et is the percentage change in the British pound (number of dollars required to buy one British pound) over period t. The regression model estimates a coefficient of bt equal to 2 . This indicates that: a. If the pound appreciates by 1%, DoDo Bird's dollar cash flows will decline by 2%. b. If the pound depreciates by 1%, DoDo Bird's dollar cash flows will increase by 2%. c. If the pound depreciates by 1%, DoDo Bird's dollar cash flows will decrease by 2%. d. If the foreign currency appreciates by 1%, DoDo Bird's dollar cash flows will increase by .5%. e. None of the above 28. One of the arguments for the relevance and importance of exchange rate exposure management is that: A) Individual investors can hedge exchange rate exposure as effectively as big companies. B) Foreign exchange markets are perfectly efficient. C) purchasing power parity holds exactly 7 D) Cash Flows become less predictable E) Cash flows become more predictable 29. The 2017 Tax Cuts and Jobs Act: a. Lowered corporate tax rate to 21% b. Imposed a Sales Tax on US-based MNC income generated overseas. c. Introduced a Value-Added Tax in the US d. Raised corporate tax rate to 41% e. Replaced the Internal Revenue Service by the External Revenue Service 30. In a perfectly integrated financial market: A. The real risk-adjusted returns of integrated markets should be higher than those of segmented markets B. There are no real risk-adjusted returns since markets are fully integrated. C. The real risk-adjusted returns should be lower than returns on segmented markets D. The real risk-adjusted returns expected to prevail in each country and currency should be equal E. The real risk-adjusted returns on integrated markets should be higher than those of segmented markets