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International Trade and Finance MCQ Questions & Answers

International Trade and Finance MCQs : This section focuses on the "International Trade and Finance". These Multiple Choice Questions (MCQs) should be practiced to improve the International Trade and Finance skills required for various interviews (campus interview, walk-in interview, company interview), placement, entrance exam and other competitive examinations.

Question 1

Trade between two countries can be useful if cost ratios of goods are:

A. Undetermined
B. Decreasing
C. Equal
D. Different

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Question 2

The term Euro Currency market refers to

A. The international foreign exchange market
B. The market where the borrowing and lending of currencies take place outside the country of issue
C. The countries which have adopted Euro as their currency
D. The market in which Euro is exchanged for other currencies

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Question 3

Which of the following theories suggests that firms seek to penetrate new markets over time?

A. Imperfect Market Theory
B. Product cycle theory
C. Theory of Comparative Advantage
D. None of the above

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Question 4

Dumping refers to:

A. Reducing tariffs
B. Sale of goods abroad at a lower price, below their cost and price in their home market
C. Buying goods at low prices abroad and selling at higher prices locally
D. Expensive goods selling for low prices

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Question 5

International trade and domestic trade differ because of:

A. Different government policies
B. Immobility of factors
C. Trade restrictions
D. All of the above

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Question 6

The margin for a currency future should be maintained with the clearing house by

A. The seller
B. The buyer
C. Either the buyer or the seller as per the agreement between them
D. Both the buyer and the seller

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Question 7

The following statement with respect to currency option is wrong

A. Foreign currency- Rupee option is available in India
B. An American option can be executed on any day during its currency
C. Put option gives the buyer the right to sell the foreign currency
D. Call option will be used by exporters

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Question 8

Govt. policy about exports and imports is called:

A. Commercial policy
B. Fiscal policy
C. Monetary policy
D. Finance policy

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Question 9

Which of the following is international trade?

A. Trade between countries
B. Trade between regions
C. Trade between provinces
D. Both (b) and (c)

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Question 10

Market in which currencies buy and sell and their prices settle on is called the

A. International bond market
B. International capital market
C. Foreign exchange market
D. Eurocurrency market

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