Question 1

As per Smithsonian Agreement 1 ounce of gold = USD _&#10;A)30&#10;B)35&#10;C)36&#10;D)38

Accepted Answer

The Smithsonian Agreement, established in December 1971, revalued the US dollar by setting 1 ounce of gold to USD 38, moving away from the previous Bretton Woods system rate of USD 35 per ounce.

Question 2

In Loro Account, Loro means ______&#10;A)our&#10;B)theirs&#10;C)yours&#10;D)my

Accepted Answer

In banking terminology, a "Loro account" refers to an account that one bank holds on behalf of another bank, essentially meaning "their account."

Question 3

GBP/ USD = 1.0376-90. In this case USD is also known as ___Currency&#10;A)base&#10;B)foreign&#10;C)variable&#10;D)transaction

Accepted Answer

In a currency pair quote, the second currency (USD in this case) is known as the variable or quote currency.

Question 4

Satistical residue is a part of _______&#10;A)errors and ommissions&#10;B)current account&#10;C)capital account&#10;D)reserve account

Accepted Answer

Statistical residue is part of errors and omissions in balance of payments accounting, capturing discrepancies between recorded credits and debits.

Question 5

EUR/USD = 1.2596-1.2620, Percentage Spread = _________&#10;A)0.0024&#10;B)1.2608&#10;C)0.19&#10;D)0.38

Accepted Answer

The percentage spread is calculated as ((Ask - Bid) / Ask) * 100. So, ((1.2620 - 1.2596) / 1.2620) * 100 = 0.19%.

Question 6

If NPV is zero, the project is _________&#10;A)financially viable&#10;B)breakeven&#10;C)financially not viable&#10;D)slower

Accepted Answer

When NPV is zero, it indicates that the project's cash inflows are exactly equal to the cash outflows, meaning it is at breakeven.

Question 7

EUR/INR 68.0000-68.0030 & INR 1.4550-1.4600 what is the arbitage oppportunity&#10;A)2228&#10;B)0&#10;C)2882&#10;D)2828

Accepted Answer

The arbitrage opportunity can be calculated by comparing the cross rates. The EUR/INR rate is 68.0000-68.0030, and the INR/USD rate is 1.4550-1.4600. By converting EUR to USD through INR, the arbitrage profit is calculated as 2828.

Question 8

___ risk is also called as &#34;Accounting Exposure&#34;&#10;A)transaction&#10;B)economic&#10;C)translation&#10;D)transmittion

Accepted Answer

Translation risk, also known as accounting exposure, refers to the risk that a company's financial statements can be affected by exchange rate fluctuations when they have to consolidate their financials from various countries into their reporting currency.

Question 9

ADR stands for ____________&#10;A)asian depository receipt&#10;B)american depository receipt&#10;C)australian depository receipt&#10;D)africa depository receipt

Accepted Answer

American Depository Receipt (ADR) is a way for U.S. investors to invest in non-U.S. companies. It represents shares in foreign stocks, making it easier for American investors to own foreign securities.

Question 10

In quote of 1 USD = INR 60, is a home country&#10;A)india&#10;B)usa&#10;C)france&#10;D)russia

Accepted Answer

The quote "1 USD = INR 60" indicates the exchange rate between the US dollar (USD) and the Indian rupee (INR). Since the exchange rate is given in terms of INR, India is the home country.

Question 11

Systematic record of economic transactions of a country during given period of time is known as ____________&#160;&#160;&#160;.&#10;A)adr&#10;B)bop&#10;C)gdr&#10;D)ifrs

Accepted Answer

The answer of Systematic record of economic transactions of a...

Question 12

Fund based services includes all of the following except .&#10;A)bill discounting&#10;B)factoring&#10;C)lease financing&#10;D)m&a services

Accepted Answer

The answer of Fund based services includes all of the...

Question 13

Nations that have major economic expansion attract&#10;A)imports&#10;B)exports&#10;C)fdi&#10;D)privatization

Accepted Answer

The answer of Nations that have major economic expansion attract&#10;A)imports&#10;B)exports&#10;C)fdi&#10;D)privatization...

Question 14

Fee Based services includes all of the following except .&#10;A)merchant banking&#10;B)factoring&#10;C)m&a services&#10;D)custodian services

Accepted Answer

The answer of Fee Based services includes all of the...

Question 15

Current account includes all of the following, except .&#10;A)merchandise balance&#10;B)services balance&#10;C)fdi&#10;D)unilateral transfers

Accepted Answer

The answer of Current account includes all of the following,...

Question 16

Reserves are held in the following forms, except ____________&#160;.&#10;A)foreign currency&#10;B)gold&#10;C)sdr&#10;D)silver

Accepted Answer

The answer of Reserves are held in the following forms,...

Question 17

Statistical residue is a part of .&#10;A)errors & omissions&#10;B)current account&#10;C)capital account&#10;D)reserve account

Accepted Answer

The answer of Statistical residue is a part of .&#10;A)errors...

Question 18

SDR is an international reserve asset created by ____________&#160;&#160;&#160;.&#10;A)imf&#10;B)wto&#10;C)world bank&#10;D)ibrd

Accepted Answer

The answer of SDR is an international reserve asset created...

Question 19

FDI in BOP is covered under .&#10;A)official reserve account&#10;B)current account&#10;C)capital account&#10;D)balancing items

Accepted Answer

The answer of FDI in BOP is covered under .&#10;A)official...

Question 20

Under Exchange rate system, there is no interference of monetary authorities to decide exchange rate.&#10;A)fixed&#10;B)floating&#10;C)mixed&#10;D)pegged

Accepted Answer

The answer of Under Exchange rate system, there is no...

Question 21

Under Exchange rate system, value of currency is decided by the market forces of demand and supply.&#10;A)fixed&#10;B)floating&#10;C)mixed&#10;D)pegged

Accepted Answer

The answer of Under Exchange rate system, value of currency...

Question 22

In Spot market, exchange of currencies take place on basis.&#10;A)t + 1&#10;B)t + 0&#10;C)t + 2&#10;D)t + 3

Accepted Answer

The answer of In Spot market, exchange of currencies take...

Deck 1: Banking and Finance