Liberty University BUSI 604 Test 2 Question 1          2 out of 2 points The public begins to experience the e”ects of deflation with an expanding money supply. Selected Answer: Question 2          2 out of 2 points Global financial markets are important to lenders for two major reasons: (1) expanding (              ) and (2) reducing (          ). Selected Answer: Question 3          2 out of 2 points (              ) is considered a sign of economic recovery and stabilization but makes the currency of a country more expensive compared to other currencies, having a direct inverse e”ect on exports and imports. Selected Answer: Revaluation Question 4          2 out of 2 points While hedging may protect against (       ), it may eliminate a potential for unexpected ( ). Selected Answer: Question 5          2 out of 2 points (              )is the largest informational platform that international traders use to communicate FX exchange rates. Selected Answer: Question 6          0 out of 2 points The end result of the global competition is higher (          ) and lower (      ) for consumers. Selected Answer: prices; exchange rates Question 7          2 out of 2 points In the United States, the Federal Reserve Bank is responsible for regulating the growth of the economy, which is accomplished by the increase or decrease of currency exchange. Selected Answer: Question 8          2 out of 2 points The two most popular products traded on security exchange markets are stocks and treasury bills. Selected Answer: Question 9          2 out of 2 points After the Gold Standard was discontinued in 1971, the (                ) followed the rule of supply and demand, and currencies started to flow freely between sellers and buyers in currency markets. Selected Answer: Question 10        2 out of 2 points Volatility represents the possibility of a change in exchange rates projected over a year. Selected Answer: Question 11        0 out of 2 points Many nations restrict hedging of their currencies due to their national and international policies and interests. Selected Answer: Question 12        2 out of 2 points Since the world thrives to trade and does not have a uniformed international currency, the exchange rate from one currency to another is determined by (              ) and (   ) on a given day on the FX Market. Selected Answer: Question 13        2 out of 2 points (              ) are used as an alternative to borrowing and lending in the Eurodollar and other o”shore markets. Selected Answer: FX swaps Question 14        2 out of 2 points A bond is a certificate with a certain monetary value. Selected Answer: Question 15        2 out of 2 points The di”erence between a (          ) rate and a (      ) rate is termed a forward discount. Selected Answer: Question 16        2 out of 2 points In the U.S., the Security Exchange Commission monitors activities of exchange markets and OTC markets. Selected Answer: Question 17        0 out of 2 points The major di”erence between the currency futures market and the OTC market is that futures settle gains and losses on a daily basis through the margin mechanism. Selected Answer: Question 18        2 out of 2 points The (      ) monitors the various companies and organizations that are quoted on the security exchange and make sure they meet the requirements for being listed. Selected Answer: Question 19        2 out of 2 points Non-tari” barriers involve financial methods (e.g., taxes on imports) of protecting national industries from competition by foreign corporations. Selected Answer: Question 20        0 out of 2 points (              ) is the United States’ second largest trading partner in Africa behind Nigeria whose exports are almost exclusively petroleum products. Selected Answer: Question 21        2 out of 2 points ASEAN association members also undertake to avoid interference in the internal a”airs of one another and are committed to the settlement of di”erences or disputes…

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