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International Finance REVISION FOR GRADUATION EXAMINATION

International Finance REVISION FOR GRADUATION EXAMINATION. Lecture 1. BOP Current Account Capital Account. Lecture 2. 1. Factors Affecting International Trade Flows Inflation National Income Government Restrictions Exchange Rates 2. Factors affecting International Capital Flows

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International Finance REVISION FOR GRADUATION EXAMINATION

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  1. International FinanceREVISION FOR GRADUATION EXAMINATION

  2. Lecture 1 BOP • Current Account • Capital Account

  3. Lecture 2 1. Factors Affecting International Trade Flows • Inflation • National Income • Government Restrictions • Exchange Rates 2. Factors affecting International Capital Flows • Factors Affecting DFI • Factors Affecting International Portfolio Investment

  4. Lecture 4 • Factors that Influence Exchange Rates • Relative Inflation Rates • Relative Interest Rates • Relative Income Levels • Government Controls • Speculating on Anticipated Exchange Rates

  5. Lecture 5 1. Government Intervention • Direct Intervention • Indirect Intervention 2. Intervention as a Policy Tool • Influence of a Weak Home Currency on the Economy • Influence of a Strong Home Currency on the Economy

  6. Lecture 6 International Arbitrage • Locational Arbitrage • Triangular Arbitrage • Covered Interest Arbitrage

  7. Lecture 7 + 8 1. Parity Conditions • Interest Rate Parity (IRP) • Purchasing Power Parity (PPP) • International Effect 2. Comparison of parity conditions

  8. Lecture 10 • Political Risk Factors • Attitude of Consumers in the Host Country • Attitude of Host Government • Blockage of Fund Transfers • Currency Inconvertibility • War • Bureaucracy • Corruption

  9. Lecture 10 • Financial Risk Factors • Current and Potential State of the Country’s Economy • Indicators of Economic Growth • Types of Country Risk Assessment • Macro-Assessment of Country Risk • Micro-Assessment of Country Risk

  10. Graduation Examination • Multiple Choices: 10 Qs 10 marks • Short Answer: 1 Q 8 marks • Applications: 1 Q 15 marks

  11. MCQ • Theoretical questions • Calculation questions • Change in the exchange rate • Bid-Ask spread • Forward premium/ discount • Cross Exchange rate • Change in the exchange rate with parity • Forward premium/ discount with parity • Country risk rating • Locational arbitrage profit

  12. Short Answer • Factors Affecting International Trade Flows - Lecture 2 • Factors affecting International Capital Flows - Lecture 2 • Factors that Influence Exchange Rates - Lecture 4 • Speculating on Anticipated Exchange Rates - Lecture 4

  13. Problem • Arbitrages - Lecture 6 • Triangular Arbitrage • Covered Interest Arbitrage

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