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MBA Second Year Sub: International Financial Management Time: 3 hours Total Marks: 100

Direction: There are total eight questions, each carrying 20 marks. You have to attempt any five questions.

1. 2. 3. 4. 5. 6. 7. 8.

What factors cause some firms to become more internationalised than others? What are the implications and uses of the balance of payments statement? Explain how these exchange-rate systems function (a) gold standard (b) par value (c) crawling peg (d) wide band and (e) floating. Explain the Purchasing Power Parity theory and the rationale behind it. Distinguish between the spot market and the forward market. Differentiate between speculation and hedging. Also, discuss the appropriate role for each in the equity market. Define transaction exposure. How is it different from accounting exposure? What is exchange risk? How can it be managed.