Hi. Please answer the following questions and provide explanations as much as possible.

1. Which of the following is a way in which a bank can deal with a troubled international loan?

A.

The loan can be restructured generally with a lower interest rate and longer time to repay

B.

The loan can be sold in the secondary market

C.

The bank can write off all or part of the loan

D.

The bank can accept exit bonds in lieu of loan repayment

E.

All of the options are ways to deal with a troubled international loan

2. A bank, concerned about risk exposure in entering a foreign market, lacking the necessary expertise and customer contacts abroad, or wishing to offer services restricted to banks alone, may choose to:

A.

set up a branch office.

B.

enter into a joint venture with a foreign financial firm.

C.

set up an agency office.

D.

set up a representative office.

E.

set up a shell branch.

3. Which of the following types of bank possesses its own charter and capital stock and is legally incorporated under host-country rules?

A.

A branch office

B.

A joint venture

C.

A representative office

D.

A subsidiary

E.

A shell branch

4. An increasing number of nations are recognizing the need of coordinating the regulatory activities so that all financial firms, serving international markets, operate under similar rules. This is known as:

A.

reconciliation

B.

accord

C.

consolidation

D.

convergence

E.

harmonization

5. Recently, FOREX trading activity among leading commercial and investment bank dealers has sharply increased due to:

A.

volatility among leading currencies.

B.

increase in security underwriting for corporations.

C.

provision of foreign marketing assistance to customers.

D.

introduction of payments and cash management services.

E.

supply of foreign currencies directly to customers.

6. An investor takes a call option on euro futures contracts at strike price of $0.65. If the market price of euro futures increases to $0.67, the call option will be called:

A.

"out of the money".

B.

"in the money".

C.

"long-hedge".

D.

"passing option".

E.

"swap money".

7. An investor takes a call option on euro futures contracts at strike price of $0.65. If the market price of euro futures reduces to $0.62, the call option will:

A.

be "in the money".

B.

be exercised before the option expires.

C.

go unexercised.

D.

increase upside profits.

E.

increase downside risk.

8. Banks and other financial firms continue to substantially consolidate and converge, resulting in more diverse service providers. This is because of:

A.

the Foreign Bank Supervision Enhancement Act.

B.

introduction of depository receipts.

C.

increase in currency swaps.

D.

increased consolidation and convergence.

E.

the Basel Agreement.