International Finance And Treasury - Study Mode
[#351] The Bretton Woods System called for:
Correct Answer
(C) Fixed exchange rates against the US Dollar
Explanation
Solution: The Bretton Woods System called for fixed exchange rates against the US Dollar. The Bretton Woods agreement was created in a 1944 conference of all of the World War II Allied nations.
[#352] The number of nostro accounts that can be maintained by a bank in a particular currency is
Correct Answer
(D) no such limit
Explanation
Solution: The number of nostro accounts that can be maintained by a bank in a particular currency is no such limit. Nostro account is maintained by Indian banks in foreign countries where they have operations for facilitating easy clearing of their transactions. These accounts are maintained with their correspondent banks overseas who in turn act as their clearing bank in the foreign country where the Indian bank has its base.
[#353] Non-resident bank accounts are maintained in
Correct Answer
(D) Indian rupee
Explanation
Solution: Non-resident bank accounts are maintained in Indian rupee. Non-Resident bank accounts are those, which are maintained by Indian nationals and Persons of Indian origin resident abroad, foreign nationals and foreign companies in India. Bank branches can open ordinary non-resident accounts in the names of private individuals provided initial deposits for opening the accounts are received from abroad in an approved manner or the initial amount is tendered in foreign currency while on a visit to India or transfer of funds from the existing non-resident account of the same person.
[#354] Full fledged money changers are authorized to undertake
Correct Answer
(D) purchase and sale of foreign currency notes, coins and travellers cheques
Explanation
Solution: Full fledged money changers are authorized to undertake purchase and sale of foreign currency notes, coins and travellers cheques. The Full Fledged Money Changers are liable to carry on the following activities: FFMCs can go into franchise agreement at their convenience for undertaking the Restricted Money Changing business which comprises the conversion of coins or traveler's cheques, foreign currency notes into (INR) Indian Rupees.
[#355] According to classification by IMF, the currency system of India falls under
Correct Answer
(A) managed floating
Explanation
Solution: According to classification by IMF, the currency system of India falls under managed floating. Managed float regime is the current international financial environment in which exchange rates fluctuate from day to day, but central banks attempt to influence their countries' exchange rates by buying and selling currencies to maintain a certain range.