International Financial Management 2nd Edition-Test Bankchapter 10

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1、InternationalFinancialManagement,2e(Bekaert/Hodrick)Chapter10ExchangeRateDeterminationandForecasting10.1MultipleChoiceEasy1)ThedecompositionofthenominalinterestrateintothesumoftheexpectedrealinterestrateandtheexpectedrateofinflationisknownastheA)FisherEffect.B)SiegelParadox.

2、C)bid-askspread.D)exchangeratepass-through.Answer:AComment:Theexanterealinterestrate,p.3372)TheFisherEffectdecomposesnominalinterestratesintothe________andtheexpectedrateofinflation.A)expectedrealexchangerateB)expectedrealinterestrateC)expectedforwardrateofreturnD)nominalexc

3、hangerateAnswer:BComment:Theexanterealinterestrate,p.3373)Thecoveredinterestrateparity,uncoveredinterestrateparity,andpurchasingpowerparity,togetherwiththeFisherhypothesisareoftenreferredtoastheA)determinantsofexpectednominalexchangerates.B)determinantsofexpectednominalinter

4、estrates.C)internationalparityconditions.D)internationalarbitrageconditions.Answer:CComment:Theinternationalparityconditions,p.3394)Ahighernominalinterestrateinonecountryindicatesthefactthatthecountry'scurrencywasexpectedto________.A)appreciateB)evaluateC)devalueD)depreciate

5、Answer:DComment:Realinterestrateparity,p.3405)Intheshortrun,equalityofinterestratesacrosscountryboundariesis________.A)unlikelyB)agooddescriptionofrealityC)agooddescriptionofpurchasingpowerparityD)aresultofstableforeigncurrencymarketsAnswer:A7Copyright©2012PearsonEducation,I

6、nc.Comment:Assessment,p.3416)________techniquesaretypicallybasedonformaleconomicmodelsofexchangeratedetermination.A)TechnicalanalysisB)FundamentalanalysisC)ExchangerateforecastingD)MeanabsoluteerrorAnswer:BComment:Fundamentalexchangerateforecasting,p.3427)Whatcurrencyforecas

7、tingtechniquelinksexchangeratestomacroeconomicvariablessuchasmoneysupplyandinflation?A)technicalanalysisB)fundamentalanalysisC)exchangerateforecastingD)meanabsoluteerrorAnswer:BComment:Fundamentalexchangerateforecasting,p.3428)Asummarystatisticalmeasurefrequentlyusedwhenfore

8、castingexchangeratesisknownastheA)standarddeviation.B)mean.C)meanabsoluteer