MS-45 International Financial Management Exam Paper

MBA - Master of Business Administration

Note: Answer any five questions.

1. Explain the concept of Balance of Payments (BOP). and discuss the different accounts of BOP. can a country run a current account deficit (surplus) indefinitely? Give reasons.

2 Discuss pre-shipment and post-shipment financing. Discuss the procedure followed by the commercial banks in this regard.

3. Distinguish between 'Foreign direct investment' (FDI) and 'Portfolio Investment' and discuss the different strategies of portfolio investment.

4. What do you understand by foreign exchange risk? What are the different external exposure management techniques which are used by importers and exporters?

5. a) Briefly discuss the centralized cash management system and its advantages.

b) What do you understand by special drawing rights (SDRs)? Discuss its significance in international Finance.

6 a) how are inflation rates and foreign exchange rates related? Illustrate with the help of an example.

b) Differentiate between accounting exposure and economic exposure. Discuss the principal translation methods of 'Foreign Subsidiaries accounts'.

7. Write short notes on any four of the following:

a) Irrevocable confirmed letter of credit
b) Syndicate euro currency loan market
c) Transfer pricing
d) International development association (IDA)
e) Foreign currency accounts of non resident Indians