Multinational Financial Management 10th Edition 题库ch04

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1、Chapter4,ParityConditionsinInternationalFinanceandCurrencyForecastingCHAPTER4ParityConditionsinInternationalFinanceandCurrencyForecastingEASY(definitional)4.1Whatisthenameofthetheorythatstatesexchange-adjustedpricesonidenticaltradeablegoodsandfinancialassetsmustbewithintransactioncostsofequalityg

2、lobally?TheLawofa)OnePriceb)Arbitragec)Parityd)CapitalMarketSegmentationAns:aSection:ArbitrageandtheLawofOnePriceLevel:Easy4.2Initsabsoluteversion,purchasingpowerparitystatesthatpricelevelsworldwideshouldbe_______whenexpressedinacommoncurrency.a)equalb)roughlyequalc)differentd)opportunitiesforarb

3、itrageAns:aSection:PurchasingpowerparityLevel:Easy4.3Whichoneofthefollowingparitytheoriesstatesthat,initsabsoluteversion,pricelevelsgloballyshouldbeequalwhenexpressedinacommoncurrency?a)purchasingpowerparityb)internationalFishereffectc)interestrateparityd)theunbiasedforwardrateAns:aSection:Purcha

4、singpowerparityLevel:Easy4.4Thetheoryofrelativepurchasingpowerparitystatesthat,betweentwonations,thea)inflationratesareunrelatedb)exchangeratedifferentialreflectstheinflationratedifferentialc)inflationrateissmallerinweakercurrenciesd)theinterestrateisgreaterthantheinflationrateduringdepreciations

5、Ans:bChapter4,ParityConditionsinInternationalFinanceandCurrencyForecastingSection:PurchasingpowerparityLevel:Easy4.5TheFishereffectstatesthatthe_________rateismadeupofarealrequiredrateofreturnandaninflationpremium.a)nominalexchangeb)realexchangec)nominalinterestd)adjusteddividendAns:cSection:Thef

6、ishereffectLevel:Easy4.6Ariseintheinflationrateinonenationrelativetootherswillbeassociatedwithafallinthefirstnation’sexchangerateandwithariseofitsinterestraterelativetoforeigninterestrates.Thetwoconditionscombinedresultinthe_________Effect.a)Fisherb)Herstattc)Unbiasedforwardrated)InternationalFis

7、herAns:dSection:ThefishereffectLevel:Easy4.7Whenariseintheexpectedinflationrateinonenationrelativetootherswillbeassociatedwithanexpectedfallinthefirstnation’sexchangerateaccompaniedbyariseofitsexpectedinterestraterelat