International Finance — Summer 2023

Explain in detail balance of payments. Elaborate the accounts of BOP.

Discuss spot and forward markets and differentiate both with hypothetical example.

What is hedging and discuss the various needs for hedging in FOREX market.

What is international finance? Discuss the nature of international financial functions.

Alice Duever purchased a put option on British pounds for $0.04 per unit. The strike price was $1.80 and the spot rate at the time the pound option was exercised was $1.59. Assume there are 31,250 units in a British pound option. What was Alice’s net profit on the option?

Write a note on Eurocurrency market and Euro bonds.

How would you define transaction exposure? How is it different from economic exposure?

What do you mean by term LIBOR? Discuss the various types of LIBOR.

Explain the random walk model for exchange rate forecasting. Can it be consistent with technical analysis?

What is the meaning of currency futures? Discuss main features of currency futures.

What is foreign exchange risk? How is it different from economic exposure?

What is the meaning of nominal, real and effective exchange rates? Discuss with hypothetical examples.

Discuss various corporate sources and uses of funds.

What are the advantages of a currency options contract as a hedging tool compared with the forward contract?

Write a note on difference between international and domestic capital markets.

Describe interest rate parity. Discuss the implications of interest rate parity for exchange rate determination.

What is Foreign Direct Investment? Explain the various strategies for FDI Page 1 of 1