Bingo Corporation could borrow at a fixed cost of 11.50% and floating at LIBOR + 0.5%. Also, Wonder Mills could borrow at a fixed rate of 10% and floating rate of LIBOR. Calculate the Quality Spread Difference.

A. 1.50%

B. 1.25%

C. 1.00%

D. 0.75%

2. Teleological ethics and deontological ethics refer to:

A. Theory of morality that derives duty of moral obligation from what is good or desirable as an end to be achieved while deontology holds that basic standards for an action’s being morally right are independent of the good or evil generated.

B. Consequentialist ethics while deontology hold that basic standards for an action’s being morally right are independent of the good or evil generated.

C. All of the above

D. None of the above

3. The shares of Qantas were selling for $7.00 on the 10^th January 2020. Given the COVID outbreak in China, you could anticipate that air travel will be affected. What type of Options will you trade?

A. Buy Call Options on Qantas shares.

B. Buy Put Options on Qantas shares.

C. Buy Call Futures on Qantas shares.

D. But Put Forwards on Qantas shares.

4. Calculate the acceptance price for a Bank Accepted Bill with $1, 000,000 face value at 5.00% interest rate for 90 days if the acceptance fee is 100 basis points.

A. $987,821.3802

B. $985,421.1663

C. $2,400.2139

D. $100.00

5. Information asymmetry leads to the problem of moral hazard and adverse selections because:

A. The information between the counterparties to the trade is not equal.

B. The information is not good enough.

C. The information available is not morally sound.

D. The information is normally symmetric but may be adversely used.

6. Why is UBER cheaper than the main taxi companies?

A. Because of agent profiteering by the owners of mainstream taxis.

B. Because UBER carefully eliminated the principal agency cost those mainstream taxis have.

C. Because of government rebates for owner drivers.

D. Because there is disagreement between UBER and the mainstream taxis.

7. It is believed that a policy has been accepted by the government of the Republic because some powerful industry stakeholders lobbied the government to endorse a policy. What theory regulatory economics theory best explains this endorsement?

A. Public interest theory

B. Republican theory

C. Electoral theory

D. Capture theory