2nd
set
Solved
assignments for Rs.150 each
08627023490
Fall-2013
Master of
Business Administration - MBA Semester 3
IB0010–International
Financial Management-4 Credits
(Book ID: B1759)
Assignment
(60 Marks)
Note: Answers
for 10 marks questions should be approximately of 400 words. Each question is
followed by evaluation scheme. Each Question carries 10 marks 6 X 10=60.
Q1. Explain the goals of
international financial management. Give complete explanation on Gold Standard
1876-1913. List down the advantages and disadvantages of Gold Standard.
Answer. International Financial
Management also
known as International Finance is a popular concept which means management of
finance in an international business environment, it implies, doing of trade
and making money through the exchange of foreign currency. A company's most
important goal is to make money and
keep it. Profit-margin ratios are one way to measure how much money a company
squeezes from its total revenue or total sales.
1. Gross
Profit Margin
The gross
profit margin tells us the profit a company makes on its cost of sales or cost
of goods sold. In other
Q2. Give an introduction on capital
account with its sub-categories. Discuss about capital account convertibility.
Answer. A national account that shows the net
change in asset ownership for a nation. The capital account is the net result
of public and private international investments flowing in and out of a
country. May also refer to an account showing the net worth of a business at a
specific point in time. The Capital
Account (also known as financial account) is one of two primary components
of the balance of payments, the other being the current account. Whereas the
current account reflects a nation's net income, the capital
Q3. Explain the concept of Swap.
Write down its features and various types of interest rate swap.
Answer. A swap is an agreement between two parties
to exchange sequences of cash flows for a set period of time. Usually, at the
time the contract is initiated, at least one of these series of cash flows is determined
by a random or uncertain variable, such as an interest rate, foreign exchange
rate, equity price or commodity price. Conceptually, one may view a swap as
either a portfolio of forward contracts, or as a long position in one bond
coupled with a short position in another bond.
A contract between two
Q4. Elaborate on measuring exchange
rate movements. Explain the factors that influence exchange rates.
Answer. Measuring exchange rate
movements:
After
defining the types of exchange rate
risk that a firm is exposed to, a crucial aspect of a firm’s exchange rate risk
management decisions is the measurement of these risks. Measuring currency risk
may prove
Q5. Write short notes on:
(a) International Credit Markets
(b) International Bond Markets.
Answer. (a) 'Credit Market'
1. The broad
market for companies looking to raise funds through debt issuance. The credit
market encompasses investment-grade bonds and junk bonds, as well as short-term
commercial paper.
2. The
market for debt offerings as seen by investors of bonds, notes and securitized
obligations such as mortgage pools and collateralized debt obligations (CDOs).
The credit
Q6. Country risk is the risk of
investing in a country, where a change in the business environment adversely
affects the profit or the value of the assets in a specific country. Explain
the country risk factors and assessment of risk factors.
Answer. Many investors choose to place a
portion of their portfolios in foreign securities. This decision involves an
analysis of various mutual funds, exchange traded funds (ETFs), or stock and
bond offerings. However, investors often neglect an important first step in the
process of international investing. When done properly, the decision to invest
overseas begins with determining the riskiness of the investment climate in the
country under consideration. Country
risk refers to the economic, political and business risks that are unique
to a specific country, and that might result in unexpected investment losses.
Economic risk:
2nd
set
Solved
assignments for Rs.150 each
08627023490
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