14 a LIBOR b BOP c Interest rate parity d Arbitrage e Hedging Forward market f g Futures Explain the factors that affect Globalization and International financial market.
A B Write a note on EXIM Bank.
[7 marks]B Write a note on current and capital account of Balance of Payment.
[7 marks]A Write a note on classic Gold Standard and Bretton Woods System. B Explain the difference between Nominal, real and effective exchange rates.
[7 marks]A Write a note on International Taxation. B What do you mean by Foreign Direct Investment? Explain the various strategies for FDIs.
[7 marks]A Explain letter of credit and the parties involved in L/C. B What do you mean by purchasing power parity? Explain with example.
[7 marks]A Write a note on transaction and translation exposure in foreign exchange market. B Give a brief idea of the Euro Bonds Market.
[7 marks]An exporter is exporting 500 units at a cost of $ 80 each and importing 500 units of material at 30/unit, he incurs other variable expenses of Rs.40,000 at the time of entering the contract, exchange rate is Rs.60/$, at the time of export it is Rs.58/$. While rate at the time of order is Rs.65/$, at the time of export is Rs.68/$. If the price elasticity of demand is 2, what are the transaction and economic exposure?
[14 marks]Find out the transaction gain/loss on the basis of the following data pertaining to India’s foreign trade: Particulars US $, million Japanese Yen, British Pound, million million Imports 1250 650 800 Exports 1150 625 850 Pre-change rate Rs.45/$ Rs.0.40/Yen Rs.70/pound Post-change rate Rs.47/$ Rs.0.41/Yen Rs.68/pound
[14 marks]