VINAYAKA MISSIONS UNIVERSITY, SALEM.

V.M.K.V.ENGINEERING COLLEGE - FACULTY OF MANAGEMENT STUDIES

MBA – 2008 Regulation - IV Semester
Elective: INTERNATIONAL FINANCE
QUESTION BANK
UNIT 1
PART - A (2 Marks)
1. What do you mean by International Finance?
2. What is International Trade?
3. What is the difference between Domestic and International Trade?
4. What do you mean by GDP?
5. Define Globalization.
6. What is international capital flow?
7. What are the theories involved in International Finance?
8. What do you mean by localization?
9. What do you mean by privatization?
10. What is Foreign Currency Exchange Rate?
11. What is meant by Foreign Exchange market?
12. What is Euro dollar market?
13. What do you mean by financial Instruments?
14. What is money market?
15. What is global capital market?
PART – B (11 Marks)
Q. No.11 - Compulsory Question category
1. Discuss the different macro issues involved in the International Finance.
Q. No. 12 – 15 Categories
1. What do you mean by International Finance? Why the need for International Finance is
emerged?
2. Discuss the different micro issues involved in the International Finance.
3. Discuss on the emerging challenges in the international finance.
4. Write a brief account on why do we need to study International Finance.
5. What are the factors involved in the International Finance?
6. What are the responsibilities of today’s financial managers?
7. Explain the growth of International Financial markets.
8. Write a note on the following:
a) Gold Standard b) Fixed exchange rate-one currency.
9. Write an essay on the choice of exchange rate.
UNIT 2
PART- A (2 Marks)
1. What are the four components of European Monetary System?
2. What do you mean by International Monetary System?
3. What is devaluation of currency?
4. What do you mean by Foreign Currency Exchange Rate?
5. When a currency is called Soft or Weak Currency?
6. What do you mean by SDR?
7. What is Floating Rate System?
8. What do you understand by Crawling Peg?
9. Define Spot Transaction.
10. Define Forward Transaction.
11. What is IMF?
12. What do you mean by Quotas?
13. What is devaluation?
14. What is SDR?
15. What is a Credit ceiling?

PART – B (11 Marks)

Q. No.11 - Compulsory Question category
1. Discuss in detail how an exchange rate is determined under undelayed and delayed
transaction.
Q. No. 12 – 15 Categories
1. What is Foreign Currency Exchange Rate? What are the classifications of IMF’S Exchange
Rate Regime?
2. What are the perquisites accepted after the collapse of the Bretton Woods Exchange Rate
System?
3. Discuss all the categories which span the spectrum of Exchange Rate Regime.
4. Discuss in detail the different exchange devices under the Exchange Rate Regime.
5. Briefly explain how currency rates are treated on the Spot Market and Forward Market.
6. Why the World Bank was established and what are principal functions of World Bank?
7. Explain the relationship between exchange and money markets.
8. Explain the concept of Special Drawing Rights in detail.
9. Explain the purpose and functions of IMF.

UNIT - 3

PART – A (2 Marks)

1. What do you mean by Balance of Payment?

2. Define Economic Transaction.
3. What is Double Entry System?
4. What are the three components of BOP?
5. What is Balance of Trade?
6. What do you mean by Balance of Invisible?
7. What is surplus in Balance of Payment?
8. What is deficit in Balance of Payment?
9. Define resident under Balance of Payment.
10. What are the components of capital account?
11. Define Current Account.
12. Define Capital Account.
13. What is meant by Import Duties?
14. What is meant by import quotas?
15. What is meant by Balance of Trade?
 PART – B (11 Marks)
Q. No.11 - Compulsory Question category
1. Give a brief description on the constraints of the capital account.
Q. No. 12 – 15 Categories
1. What do you mean by Balance of Payment? Explain its components in detail.
2. What are the elements in the current account? Discuss in detail.
3. Discuss in detail about Balance of Trade and Balance of Invisible?
4. Briefly explain the capital account of a country in Balance of Payment context. What are the
newly or recently accepted classifications of capital account?
5. List out the recommendations given by Dr. Rangarajan Committee for balance of payment.
6. Explain the following:
a) Economic Transaction
b) Double Entry System
c) Concept of Residence
d) Time of Recording
7. Explain the components of Balance Of Payments in detail.
8. Explain the factors influencing Balance of payments Disequilibrium.
9. Narrate in detail about correction of Balance of payments Disequilibrium.
UNIT 4

PART – A (2 Marks)

1. Define foreign exchange market.

2. What is spot market?
3. What is future market?
4. Who are the five participants in foreign exchange market?
5. Define primary price maker.
6. What is secondary price maker?
7. Who is called price taker?
8. What is international trade?
9. What do you mean by currency option?
10. What do you mean by clearing house?
11. What is exchange instruments?
12. What is meant by rate of exchange?
13. Give any two components in structure of foreign exchange market.
14. What is Control Speculation?
15. Who is called as price maker?

PART – B (11 Marks)

Q. No.11 - Compulsory Question category
1. Who are the parties involved in the foreign exchange market?

Q. No. 12 – 15 Categories
1. What is foreign exchange market? What are the functions of foreign exchange market?
2. What are the foreign exchange instruments? Discuss in detail.
3. Discuss the methods of foreign payments under the foreign exchange market.
4. How the exchange rate is determined under the foreign exchange market?
5. Write down the factors which are influencing the rate of exchange. Discuss.
6. Give a brief account on the structure of foreign exchange market.
7. Explain Purchasing Power Parity (PPP) theory in detail.
8. Explain the concept of Expected Exchange Rate (EER) in detail.
9. Explain link between Euro Dollar market and offshore centers.

UNIT- 5

PART- A (2 Marks)

1. What do you mean by foreign risk?

2. What are the different forms of Currency Risk?
3. Define Credit risk.
4. What is Netting?
5. What do you mean by risk sharing?
6. What do you mean by Transaction exposure?
7. What do you mean by Accounting Exposure?
8. What is Risk control?
9. What is financial risk?
10. What is Inflation Risk?
11. What is counter trade?
12. What is Gray market?
13. What is convertible bonds?
14. What is foreign exchange Risk?
15. What is meant by Forward Market?

PART – B (11 Marks)

Q. No.11 - Compulsory Question category
1. What do you mean by Accounting Exposure and Economic Exposure? Discuss in brief.
Q. No. 12 – 15 Categories
1. What do you mean by Foreign Exchange Risk? What are the forms of Currency Risk?
2. What are the external techniques of exposure Management? Discuss each in detail.
3. What are the External techniques of Exposure Management? Describe in detail.
4. Give a brief account on the different dimensions of Foreign Exchange Risk.
5. Write a short note on – a) Invoicing b) Netting
6. Explain the following:
a) Leading b) Risk Sharing
7. Discuss in brief: a) Forward market b) Discounting of bills receivable
8. Discuss the following:
a) Factoring of receivable b) Currency overdraft
9. Write a short note on the following:
a) Currency Swaps b) Exchange risk guarantee.
 Vinayaka Missions University, Salem
Faculty of Management Studies
MBA DEGREE EXAMINATION,
Model Question Paper
IV Semester
INTERNATIONAL FINANCE
Time: 3 Hrs Max. Marks: 75 Marks

Part – A (10 X 2 = 20 Marks)

Answer all the questions. All questions carry equal marks

Part A (10*2=20)

1. What is the difference between Domestic and International Trade?

2. What do you mean by GDP?
3. When a currency is called Soft or Weak Currency?
4. What do you mean by SDR?
5. What is Balance of Trade?
6. What do you mean by Balance of Invisible?
7. Define primary price maker.
8. What is secondary price maker?
9. Define Credit risk.
10. What is Netting?
Part – B (5 X 11 = 55 Marks)

Q. No.11 is compulsory.

11. What are the responsibilities of today’s financial manager?

12. a) Discuss in detail the different exchange devices under the Exchange Rate Regime?
(OR)
b) Give a brief description on the constraints of the capital account?
13. a) Briefly explain how currency rate are treated on Spot Market and Forward Market?
(OR)
 b) What do you mean by Balance of Payment? What are their components discuss in
brief?
14. a) What are the parties involved in the foreign exchange market?
(OR)
b) What are the foreign exchange instruments? Discuss in detail.
15. a) What are the external techniques of exposure Management? Discuss each in detail.
(OR)
b) What do you mean by Accounting Exposure and Economic Exposure? Discuss in brief.

--------------