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In direct quotation exchange rate is:
The home currency is fixed and foreign currency is variable
The foreign currency is fixed and home currency is variable
None of the above

In indirect quotation exchange rate :
The home currency is fixed and foreign currency is variable
The foreign currency is fixed and home currency is variable
None of the above

Your import customer has requested bank to retire a bill for USD 50000/- received for collection. The ongoing interbank rates for USD are :-Spot = USD 1 = Rs.66.5050/5250One month forward = USD 1 = Rs.66.7225/7425Bank’s correspondent charges USD 100.Exchange margin .15% . Calculate the exchange rate and rupee amount payable by the customer.
66.5250 & Rs. 33,32,902/-
66.7425 & Rs.33,37,125/
66.6250 & Rs.33,37,912/-
66.7580 & Rs.33,37,900/-

Determine which of the following transaction is purchase of foreign exchange from client's point of view :
Bank sent an export bill on collection basis
The customer of bank order a TT on Newyork USA for USD 500
A traveler encashes at a bank a Traveler Cheque for USD 100
The bank receive a DD drawn on London for GBP 100 for customer

The transaction in which bank receives foreign currency from the customer and pays him in local currency is a :
Purchase transaction
Sale transaction
Direct transaction
Indirect transaction

The currency is at Premium when :
It is costlier in future
It is cheaper in future
It is at par in future
none of the above

The currency is at Discount when
It is costlier in future
It is cheaper in future
It is at par in future
none of the above

In Mumbai USD Is quoted as under :USD 1 = 66.5000/5200July = .0900/1100Aug = .2100/2300Sept = .3200/.3400Oct = .3800/4000Nov = .4400/4600Dec = .5000/5200
Above quotation of rate is an Indirect quotation
Direct quotation
none of the above

In Mumbai USD Is quoted as under :USD 1 = 66.5000/5200July = .0900/1100Aug = .2100/2300Sept = .3200/.3400Oct = .3800/4000Nov = .4400/4600Dec = .5000/5200In above quotation spot buying rate will be
66.5200
66.5900
67.0200
66.5000

. In Mumbai USD Is quoted as under :USD 1 = 66.5000/5200July = .0900/1100Aug = .2100/2300Sept = .3200/.3400Oct = .3800/4000Nov = .4400/4600Dec = .5000/5200. In above quotation spot selling rate will be:
66.5200
66.5900
67.0200
66.5000

. When bank is quoting as above it means, the bank would buy at-----rate and sell at-----rate
Bid/spot
Spot/ask
Bid/offer
Spot/forward

In the prevoius case USD is at ---------- and INR at---------:
Premium /discount
Discount/discount
Discount/premium
Premium/premium

The Two way quotation is applicable to :
All merchant transactions uniformly
Specific to transaction for which it is quoted
Applicable to Interbank transactions
Applicable only for traders

TT buying rate is applicable for transactions where :
Remittance is received by telecommunication
Remittance is sent by telecommunication
The nostro a/c of the bank is already credited
The nostro a/cod the bank already debited

In Mumbai, USD is quoted as USD 1 = 66.5250/5450, it means :
The buying rate is Rs.66.5250 and selling rate is Rs.66.5450
The buying rate is Rs.66.5450 and selling rate is Rs.66.5250
The USD is appreciating in value
The USD is depreciating in value

Your import customer has requested bank to retire a bill for USD 50000/- received for collection. The ongoing interbank rates for USD are :-Spot = USD 1 = Rs.66.5050/5250One month forward = USD 1 = Rs.66.7225/7425Bnak’s correspondent charges USD 100.Exchange margin .15% . Calculate the exchange rate and rupee amount payable by the customer.
66.5250 & Rs. 33,32,902/-
66.7425 & Rs.33,37,125/-
66.6250 & Rs.33,37,912/-
66.7580 & Rs.33,37,900/-

The merchant rate for Euro against rupee is calculated by bank’s in India :
Directly based on interbank euro/rupee rate
Directly based on RBI rate for euro
As a cross rate using doller/rupee rate and euro/usd rate
As a cross rate using euro/rupee rate and euro/sterling rate

If USD/INR rate is 65.50 and GBP/USD rate is 1.5250, what is the rate for GBP/INR
Rs. 42.95
Rs. 89.88
Rs. 99.89
Rs. 74.94

An export customer request the bank to quote him a rate for purchase of export bill for SGD 100000/- for 30 days sight drawn on Singapore. Assuming USD quoted in interbank market as under:Spot = USD 1 =66.5500/57001 month forward = .2200/24002 month forward = .4700/49003 month forward = .6900/7100Singapore dollars are quoted in Singapore as under:Spot = USD 1 =SGD 1.3500/35101 month forward = = .0045/00402 month forward = = .0065/00603 month forward = = .0085/0080What is the nature of the transaction for bank i.e. purchase or sale. What will be the rate quoted to the customer. Also calculate the rupee amount payable to customer bearing in mind the following:1) Transit period is 25 days2)Exchange margin to be included in the rate is .10%3)Interest to be recovered at 10%4) Calculations may be nearest to month end and exchange rate up to 2 decimals.
Sale transaction, Exchange rate 49.33 per SGD ,Rupee amount receivable 49,07,914/-
Purchase transaction, Exchange rate 49.33 per SGD, Rupee amount payable 49,07,914/-
Purchase transaction, Exchange rate 49.83 per USD, Rupee amount payable 49,07,914/-

Derivatives are so called because
They are subsidiary product in the market
They are derived from combination of different assets
Their value is dependent on the value of some other fundamental variable
They are traded on derivative exchanges

Derivatives can be used by an exporter for managing
Currency risk
Cargo risk
CREDIT RISK
All of the above

Which instrument below is not a derivative product
Forward contract
Options
Mail transfer
Futures

An export customer had booked a forward contract at Rs.65.50. On the due date, the bill buying rate is Rs.65.10. The exporter :
Can repudiate the forward contract and sell in ready market
Can persuade the bank to offer a better rate under the forward contract
Can persuade the bank to offer a better rate under the forward contract
Has to fulfill obligation under forward contract at contracted rate.

A customer who has booked a forward contract but wishes to cancel it should do so
Only on the due date
On or before the due date
On or before or after the due date
Never, as forward contract cannot be cancelled by the customer

The following statement with respect to currency option is wrong
Call options will be used by the exporters
Put options will give the buyer the right to sell the foreign currency
Foreign currency-rupee option is available in India
An American option can be executed on any day during its currency

The strike price under an option is
The price at which the option is auctioned
The exchange rate at which the currencies are agreed to be exchanged under contract
Lower of the market price and agreed price
) None of the above.

Which statement is correct :
Forward contracts are not binding on both the parties
Buyer of the option has the right not obligation to exercise option
Option contracts are not useful for contingent liabilities
American options can be exercised on maturity date

In international financial market swap means :
Simultaneous sale and purchase of one currency for another for different periods
Swaps are not undertaken for hedging foreign currency loan exposure
An exchange of specific streams of payments over an agreed period of time between parties
Cross currency interest rate swap is not a combination of interest rate swap and currency swap

Which statement is correct with regard to future contracts
Future contracts are for standardised amount, quality , quantity and future delivery date, they do not provide perfect hedge
Futures are over the counter products
Futures are not marking to market
Future contracts can be issued for any odd amount

Which statement is not true with regard to correspondent banking
The growth of correspondent banking is linked to growth of international trade
Correspondent relationship allows bank to take advantage of business opportunities
Correspondent banks typically handle the transactional requirement of the other banks
None of the above

While performing clearing house functions, correspondent bank face following risk
Credit risk and systemic risk
Market risk and systemic risk
Credit risk and currency risk
Liquidity risk market risk

.When the F/C dealers are unable to exit the position quickly and there is risk on account of adverse movement of market variables, it is called :
market risk
settlement risk
systemic risk
interest rate risk

. ------------relates to valuation of F/C assets and liabilities at the end of the accounting year at the current realizable value
operating exposure
F/C exposure
translation exposure
Transaction exposure

An Indian resident becomes non-resident for the purpose of FEMA in case
He/she goes abroad for studies
He/she resides abroad for employment or carrying on some business indicating an indefinite stay abroad
Govt. officials , officials of PSUs deputed abroad are treated as NRIs
All the above

Term deposits in foreign currency can be opened in
Non-resident (ordinary) account
Non-resident (external) account
Foreign currency non-resident (bank) account
Resident account

Opening of an account with eligible local funds is allowed in case :
Non-resident ordinary account
Non-resident external account
Blocked account
None of the above

FCNR (B) accounts can be opened in following currencies
USD GBP,EURO,AUD,DKK,SGD
USD GBP,EURO,AUD,JPY,HKD
USD GBP,EURO,AUD,CAD,JPY
USD GBP,EURO,SFR,SEK,AUD

The minimum period for whch FCNR(B) account can be opened
46 days
90 DAYS
6 months
one year

. A Resident Foreign Currency Account is meant for :
A resident in India who wants to convert his rupee earning into foreign currency deposit
A resident in India who has sources of income/assets in foreign currency
A foreigner who comes for permanent settlement in India
None of the above

Foreign direct investment in Indian companies
Can be in the form of shares and convertible debentures
Is permitted subject to sectoral ceiling
Comes under the automatic route of Reserve Bank
All the above

Mr. X, an Indian citizen, goes to Australia to take up employment. He leaves his job and return to India after 6 months. He has a fixed deposit of AUD 20,000/- in a bank in Sydney. Can he maintain this account on his return ?
He can maintain this account as has completed 6 months, the minimum eligibility period for NRI
He can maintain foreign currency account for his legitimate funds earned during his stay abroad even on his return after 6 months
He can maintain his foreign currency account abroad provided he has returned to India after a minimum stay of one year
None of the above

A foreigner on his short visit to India wants to have a bank account
he can open a saving bank or current account maximum for a period of 6 months with funds from outside India
he can open any type of account for a period of 6 month with funds from outside India
at the time of departure back, the balance amount of funds cannot be coverted into foreign currency
after 6 months funds cannot be repatriated abroad

Securities purchased by NRIs on nonrepatriation basis, when sold can be credited to which of the following account
FCNR(B)
NRE-RA
NRO
ANY OF THESE ACCT.

NRIs cannot make investment in which of the following
govt. securities
small saving schemes and public provident fund
treasury bills
units of mutual funds

Maximum amount allowed for personal visit abroad :
USD 5000 (eq.) per financial year
USD 10000(eq.) per financial year
USD 10000(eq.) per calendar year
USD 10000(eq.) per visit

The maximum limit for Liberalised Remittance Scheme for resident individual is :
USD 75000 (eq.) per financial year
USD 500000 (eq.) per financial year
USD 250000 (eq.) per financial year
USD 125000 (eq.) per financial year

Foreign exchange transaction involve monetary transaction
Among residents of same country
Between residents of two countries only
Between residents of two or more countries
Among residents of at least three countries

. Which of the following statement is true :
Foreign exchange leads to foreign trade
Foreign trade leads to foreign exchange
No exchange is involved in foreign trade
There is no link between foreign trade and foreign exchange

. A company has four branches at Bangalore, Chennai, Delhi and Mumbai. IEC code no. should be obtained by :
The head office, which can be used by all branches
Each branch separately
Any one branch, which can be used by all branches
All branches simultaneously

Force majuere clause in an export contract
Relates to penalty for non fulfillment of contract
Exempt the exporter from liability from non fulfillment of contract due to reasons beyond his control
Provides for enforcing the contract compulsorily
None of the above

An exporter who deals in multi products should get Registration-cum-Membership Certificate from :
All export promotion councils relevant to the products dealt in
Export promotion council nearest to the head office of the exporter
Export promotion council of the main line of activity or FIFO
None of the above

. Under advance remittance as a method of payment credit risk is borne by :
The importer
The exporter
Importer’s bank
None of the above

. When the goods are sent to an agent of an exporter in the importing country, the method of payment adopted is
Open account
Letter of credit
Consignment Sale
Documents against acceptance

The method of payment where the exporter relies on the undertaking of a bank to pay is :
Bank guarantee
Letter of credit
Letter of comfort
None of the above

Where the export advance has been received, the export to be completed
Within 6 months from the date of advance
Within one year from the date of receipt of advance
There is no time limit for completing the export
nONE OF THE OTHERS

The period of realization/repatriation of proceeds of export of goods/software/services is except for the goods exported to a warehouse established outside India
It is 12 months from the date of export
It is 9 months from the date of export
It is 6 months from the date of export
There is no time period

The export of Indian currency is restricted to except Nepal and Bhutan.
Currency notes of GOI and RBI up to an amount not exceeding Rs.10000/-
Currency notes of GOI and RBI up to an amount not exceeding Rs.7500/-
Currency notes of GOI and RBI up to an amount not exceeding Rs.25000/-
Export of Indian currency is not permitted

Softex form is used for
Export otherwise than post
Export through custom office with EDI system
Export by post
Export of software otherwise than in physical form

Exporter should lodge the shipping documents with AD bank within
18 days from the date of export
21 days from the date of export
30 days from the date of export
None of the above

The current account of balance of payments includes
unilateral payments
portfolio investment
short term borrowing
long term borrowing

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