51. What is the purpose of a currency swap in Forex Management?
a. To exchange one currency for another at a predetermined exchange rate
b. To speculate on currency movements and earn profits
c. To borrow funds in one currency and lend in another currency
d. To hedge against exchange rate fluctuations
52. Which of the following is NOT a factor influencing the demand and supply of foreign exchange?
a. Interest rates
b. Inflation levels
c. Government fiscal policy
d. Population growth rate
53. What does the term “Balance of Payments” (BoP) refer to?
a. The total value of a country’s imports and exports
b. The difference between a country’s income and expenditure
c. The record of all economic transactions between residents of one country and residents of other countries
d. The sum of a country’s external debt and foreign exchange reserves
54. What is the current account in the Balance of Payments?
a. It records international trade in goods and services.
b. It records international capital flows.
c. It records changes in foreign exchange reserves.
d. It records external debt obligations.
55. Which of the following is an example of a current account transaction?
a. Exporting goods to a foreign country
b. Foreign portfolio investment
c. Repayment of external debt
d. Currency exchange for travel purposes
