Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
Call us at : 08263069601
Master of Business Administration
Paper Code: MB FM– 203
Paper Title: International Finance Management
Q. 1. Short answer type questions: Limit 100 – 150
(i) What do you understand by balance of payment?
Answer: Balance Of Payment (BOP) is a statement which records all the monetary transactions made between residents of a country and the rest of the world during any given period. This statement includes all the transactions made by/to individuals, corporates and the government and helps in monitoring the flow of funds to develop the economy. When all the elements are correctly included in the BOP, it should sum up to zero in a perfect
(ii) Define any five factors which influence exchange rate.
Answer: 1. Inflation rates
Inflation rates impact a country’s currency value. A low inflation rate typically exhibits a rising currency value, as its purchasing power increases relative to other currencies.
2. Interest rates
Exchange rates, interest rates and inflation
(iii) Give five differences between centralized versus decentralized cash management
Answer: Centralization/decentralization refers to how much decision-making authority has been delegated to lower management levels. Few organizations could function effectively if all decisions were made by a select group of top managers, nor could they do so if all decisions were delegated to the lowest levels of the organization.
(iv) Give five differences between forward and future contract?
Answer: The fundamental difference between futures and forwards is that futures are traded on exchanges and forwards trade OTC. The difference in trading venues gives rise to notable differences in the two instruments:
Futures are standardized instruments transacted through brokerage firms that hold a “seat” on the exchange that trades that particular contract. The terms of a futures contract – including delivery places and dates, volume, technical specifications, and trading and credit procedures – are standardized for each type of contract. Like
(v) What do you understand by translation espouser?
Answer: Translation exposure is a kind of accounting risk that arises due to fluctuations in currency exchange rates. The assets, liabilities, equities, and earnings of a subsidiary of a multinational company are usually denominated in the currency of the country it is situated in. If the parent company is situated in a country with a different currency, the values of the holdings of each subsidiary need to be converted into the currency of the home country.
Such conversion can lead to certain
(vi) What do you understand by international finance management?
Answer: International financial management, also known as international finance, is a well-known term in today’s world. It simply means financial management in an international business environment. It is different from financial management because of the different factors involved like currency, political situations, imperfect markets, and diversified opportunity sets.
Objectives of International
(vii) “Explain the concept of Interest Rate parity theorems.
Answer: The interest rate parity (IRP) is a theory regarding the relationship between the spot exchange rate and the expected spot rate or forward exchange rate of two currencies, based on interest rates. The theory holds that the forward exchange rate should be equal to the spot currency exchange rate times the interest rate of the home country, divided by the interest rate of the foreign country.
As with many other theories, the equation
(viii) Do you think cash management system effect the borrowing decisions of a firm?
Answer: What is Cash Management?
Cash management, also known as treasury management, is the process that involves collecting and managing cash flows from the operating, investing, and financing activities of a company. In business, it is a key aspect of an organization’s financial stability.
(ix) Explain the concept of Arbitrage in Foreign exchange market
Answer: “Arbitrage” in Foreign Exchange Market
Arbitrage is the process of a simultaneous sale and purchase of currencies in two or more foreign exchange markets with an objective to make profits by capitalizing on the exchange-rate differentials in various markets.
The arbitrage
(x) Explain the concept of Internal and external techniques of risk.
Answer : Risk management is crucial to the success of all software development, enhancement and maintenance projects. Risk management at its basest level is avoiding problems that can be avoided and recognizing those that can’t be avoided. In order to recognize and avoid problems, every project must take the steps that need to be taken to consciously look outward and forward. The act of risk management requires both
(Word limits 500)
Q. 2. Explain the process of issuing ADR and GDR?
Answer: What are American Depository Receipts (ADRs)?
American Depository Receipts (ADRs) are a way of trading non-U.S. stocks on the U.S. exchange. Through ADRs, Indian companies who are willing to raise funds from the U.S. can do so by issuing shares on American Stock exchange.
Q. 3. Explain the Aspects of international cash management?
Answer: Management of short-term assets and liabilities – cash, investments, inventories, receivables and payables, is an important part of finance manager’s job. When it comes to management of inventories, receivables etc. there is not much difference between a multinational and domestic firms. Among these cash management can be considerably more complex for multinational finns because of possibility of raising and deploying cash in many currencies, many locations and profit opportunities presented by imperfection in international money and foreign exchange markets. In this unit, you
Q. 4. Discuss financial structure of foreign subsidiaries of MNCs.
Answer: Once the decision about overall debt-equity mix of an MNC is made, another critical issue that needs to be addressed astutely by the MNC parent is to determine the debt-equity financing mix for its offshore affiliates.
This calls upon the multinational finance manager to evaluate the following three options:
i. Debt-equity mix of the subsidiary should conform to the parent company norms.
Q. 5. Explain different type of International financial market instruments.
Answer: Instruments are a means to an end. You want to create music, you need a musical instrument. You want to see videos, you need an audio-visual instrument/equipment. Similarly, you want to make some money, you need to own a financial instrument. Financial instruments are financial contracts between interested parties. They can be created, traded, modified and settled. There are different types of financial instruments, viz, currency, share and bond.
Types of Financial Instruments
Q. 6. Explain the concept of International Monetary System?
Answer: International monetary system refers to a system that forms rules and standards for facilitating international trade among the nations.
It helps in reallocating the capital and investment from one nation to another.
It is the global network of the government
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
Call us at : 08263069601