Hi.

98.

Suppose India restricts entry of foreign banks until the end of the decade. This would be in support of which reason for regulating international banks?

A.

Protecting the safety of depositor funds

B.

Promoting stable growth in money and credit

C.

Providing foreign currency controls

D.

Protecting domestic financial institutions

E.

Restricting the outflow of scarce capital

99.

Suppose South Korea limits the amount of deposits made in South Korea that can be used to make loans in other countries. This would be in support of which reason for regulating international banks?

A.

Protecting the safety of depositor funds

B.

Promoting stable growth in money and credit

C.

Providing foreign currency controls

D.

Protecting domestic financial institutions

E.

Restricting the outflow of scarce capital

100.

Suppose Bank of America holds assets denominated in yen of 150 million and liabilities denominated in yen of 90 million. They also have yen purchases of 70 million and yen sales of 50 million. What is Bank of America's net exposure to currency risk?

A.

+ 150 million yen

B.

+ 60 million yen

C.

+ 80 million yen

D.

- 80 million yen

E.

- 60 million yen

101.

Suppose Bank of America holds assets denominated in yen of 150 million and liabilities denominated in yen of 90 million. They also have yen purchases of 70 million and yen sales of 50 million. When would Bank of America experience a loss in the currency market?

A.

When the yen declines in value relative to U.S. dollars

B.

When the yen increases in value relative to U.S. dollars

C.

When U.S. dollar declines in value relative to the yen

D.

When the euro declines in value

E.

None of the options is correct.

102.

Suppose Citibank holds assets denominated in euros of 120 million and liabilities denominated in euros of 180 million. They also have euro purchases of 40 million and euro sales of 70 million. What is Citibank's net exposure to currency risk?

A.

+ 120 million euros

B.

- 90 million euros

C.

+ 90 million euros

D.

- 60 million euros

E.

+ 60 million euros

-fm