Find out the arbitrage possibilities for various periods.

1
International finance Managementinfo_at_casestudy
help.in91 94220-28822
2

• International finance Management
•  
• Q1.Centralized cash management is a double
  edged sword for international working capital
  management Discuss.
• Q2.Balance of payments always balances
  Comment.
• Q3.How does the international Monitory fund raise
  the resources ? What are special drawing rights?
  Briefly explain the funding facilities provided
  by IMF to its member countries
• Q4.How does international financial system differ
  from domestic financial system?
• Q5.What is infra-corporate transfer of fund?
  Explain the variable that influence intra
  corporate transfer of funds.

3

• Q6.Explain purchasing power parity and reason for
  its deviation. Also discuss its applications.
• Q7.Critically examine the impact of developments
  in the emerging foreign exchange markets.
• Q8.Consider the following data Exchange Rate
  Interest Rate Interest Rate Spot 1 1,5753/
  - -1 month 1, 5623/ 3 p.a 8.5 p.a 3 months
  1, 5577/ 3.5 p.a 7.5 p.a 6 months 1.5536/
  3.5 p.a 7 p.a
• Q9.Find out the arbitrage possibilities for
  various periods.
• Q10.Show how interest rate parity will be
  restored as a result of arbitrage activities.

4

• Q11.You are setting up a project in USA. The
  estimated NFV is 12 million. Your finance
  officer started in the report that he has not
  accounted for foreign exchange risk. He felt that
  with such a large NPV, the project should be
  accepted since even a risk adjusted NPV would
  likely be positive. You have the final decision
  as to whether to accept or reject the project.
  What is you decision? Calculate the following
  rates into outright rates ii) Indicate their
  spreads

5

• www.casestudyhelp.in
• info.casestudyhelp_at_gmail.com
• info_at_casestudyhelp.in
• 91 94220-28822