a)The implicit exchange rate between two currencies when both are quoted in some third currency is called a(n):

Select one:

1. open exchange rate.

2. cross-rate.

3. backward rate.

4. forward rate.

5. interest rate.

b)

International bonds issued in multiple countries but denominated in a single currency are called:

Select one:

1. Treasury bonds.

2. Eurobonds.

3. Bulldog bonds.

4. Samurai bonds

5. Yankee bonds.

c)

The idea that the exchange rate adjusts to keep buying power constant among currencies is called:

Select one:

1. interest rate parity.

2. uncovered interest rate parity.

3. purchasing power parity.

4. the international Fisher effect.

5. the unbiased forward rates condition.

d)

Which of the following statements are correct concerning the variance of the annual returns on an investment?

I. the larger the variance, the more the actual returns tend to differ from the average return.

II. the larger the variance, the larger the standard deviation.

III. the larger the variance, the greater the risk of an investment.

IV. the larger the variance, the lower the expected return

Select one:

1. I and II only

2. I and III only

3. II, III, and IV only

4. I, III, and IV only

5. I, II, and III only

6. I, II, III, and IV