QUESTION 44

1. Which of the following statements is not accurate about global macro hedge fund?

   	a.	The fund managers take risk positions on the future value of global currencies, debt instruments, commodities and equity indices.
   	b.	A global macro hedge fund leverages its capital with credit lines from major money center banks like J.P. Morgan, Goldman Sachs and UBS. This use of leverage makes its returns less volatile than if it was unleveraged.
   	c.	The clients of a global hedge funds are primarily institutional investors and family offices worldwide.
   	d.	A global hedge fund usually charges a 2% management fee and a 20% performance fee based on high watermarks.
   	e.	George Soross Quantum Fund is an example of one of the worlds most successful global macro hedge funds.

QUESTION 38

1. If the US goes into a recession and corporate cash flows deteriorate, the riskiest bonds to own would be:

   	a.	AAA rated 2-year Treasury notes.
   	b.	Floating rate notes of Microsoft.
   	c.	AAA rated 3-month Treasury bills.
   	d.	A high yield bond issued by a crypto exchange start-up that is not profitable.
   	e.	A bank certificate of deposit issued by J.P. Morgan with a maturity of 6-months.

QUESTION 37

1. The main reason why US Treasury bonds are viewed as a risk-free asset is:

   	a.	US Treasury bonds are held by dozens of foreign central banks all over the world.
   	b.	When the Federal Reserve tightens monetary policy, US Treasury bond yields spike higher as in 2022.
   	c.	More than 90% of the assets of UAE Central Bank are invested in US Treasury bonds.
   	d.	The US government has the power of taxation and thus US Treasury bonds do not have any default risk.
   	e.	The US economy is the largest economy in the world.

QUESTION 28

1. Microsoft (MSFT) shares have fallen more than 30% from its high last November, primarily because:

   	a.	High interest rates are negative for growth sectors like technology and Microsoft was trading at a 35 price/earnings ratio in November 2021 when the Powell Fed changed its monetary policy from easy money to tight money.
   	b.	The strong US dollar hurts Microsoft because its earns 50% of its profits outside the US.
   	c.	A US recession means a fall in IT spending by corporations and consumer spending on products like Xbox consoles.
   	d.	A & C
   	e.	A, B & C

QUESTION 26

1. US banks and private equity fund CEOs are eager to do business with Saudi Arabia for all the following reasons despite a big chill in diplomatic relations between the kingdom and the Biden White House when the Saudis led a 2 million barrel a day output cut by OPEC+. Which of the following statements is incorrect?

   	a.	Saudi GDP growth is 7% in 2022, one of the fastest in the world.
   	b.	Saudi sovereign wealth fund PIF is a major global investor and Wall Streets bankers, brokers and fund managers are eager to do business with it.
   	c.	Saudi Arabia imposes capital control and it is difficult for US banks to repatriate profits earned from doing business in the kingdom.
   	d.	Saudi Arabias vision 2030 program creates the opportunity to secure huge banking fees in deals like the privatization IPO of Saudi Aramco.
   	e.	The rise in oil prices after the Russian invasion of Ukraine has led to increase government spending in Saudi Arabia and the GCC on infrastructure projects. This creates financing and fee generation opportunities for US banks