Subject Code: IMT-86

Subject Name : International

Financial Management
INSTRUCTION

a. b. c. d. A. B.

Write answers in your own words as far as possible and refrain from copying from the text books/handouts. Answers of Ist Set (Part-A), IInd Set (Part-B), IIIrd Set (Part C) and Set-IV (Case Study) must be sent together. Mail the answer sheets alongwith the copy of assignments for evaluation & return. Only hand written assignments shall be accepted. First Set of Assignments: Second Set of Assignments: 5 Questions, each question carries 1 marks. 5 Questions, each question carries 1 marks. 5 Questions, each question carries 1 marks. Confine your answers to 150 to 200 Words. Two Case Studies : 5 Marks. Each case study carries 2.5 marks.

C. Third Set of Assignments: D. Forth Set of Assignments:

ASSIGNMENTS
FIRST SET OF ASSIGNMENTS Assignment-I = 5 Marks

PART A
1. Thedeterminationofweightedaveragecostofcapitalrequiresthecalculationofspecificcosts ofdifferentsourcesoflongtermfunds.Comment 2. Whatdoyoumeanbyfinancialmarkets?Explainitstypesandfunctions. 3. Explainthemeaningofcrosslistingofshares.Whycompanydecidetocrosslistitsshares? 4. WhatdoyoumeanbyGoldStandard,explainitsadvantagesanddisadvantagesalso? 5. INR.47.10 47.25 per USD is a direct quote. Another direct quote is /179180. Specify: The countrywherethequoteismade. Thebid,askandspread. FortheAskprice: (i) Currencybeingboughtbythebank. (ii) Currencybeingboughtyou FortheBidprice: (iii) Currencybeingboughtbythebank (iv) Currencybeingboughtbyyou.
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SECOND SET OF ASSIGNMENTS

Assignment-II = 5 Marks

PART B
1. WhenWorldBankcameintoexistence,howithasbeenconstituted?Explainitscharacteristics also. 2. Explainforeignexchangemarkets?Whoaretheplayersofthismarket? 3. Fromthefollowingimaginaryquotes $0.33020.3310perDM $0.11800.1190perFF DeriveBid/AskDMratesforoneunitofFF. Note:DMmeansDeutscheMarksandFFmeansFrenchFrancs. 4. Capitalbudgetingdecisionshavetobetakenkeepingtheperspectiveofboththesubsidiary andtheparentcompanyinmind,explainwiththehelpofreasonsforchangesincashinflows ofboththecompanies. 5. Whatiscountryriskandhowitcanbereduced?
THIRD SET OF ASSIGNMENTS Assignment-II = 5 Marks

PART C
1. Whatisdoubletaxationrelief?Whatarethemodesofgrantingdoubletaxationrelief? 2. ExplainthemeaningofIFRS.Whataretheirfeaturesandwhatarechallengesinimplementing IFRS? 3. Explainthemeaningofnetting.Explainitstypeswiththehelpofsuitableexample. 4. ExplaindomesticCAPMandInternationalCAPM.Whatarethemainareasofdifficultiesin extendingdomesticCAPMtotheinternationalCAPM? 5. Theriskfreeinterestrateis8%.Therateofreturnandtheriskintermsofstandarddeviationin Indiaandsomeforeigncountriesarerespectivelyasfollows: a. India11%and3.16 b. Australia10%and4.05 c. UK9%and1.80 d. USA14%and5.40 Findthecountry/countrieswhereanIndianinvestorshoulddiversifyitsinvestment.
FOURTH SET OF ASSIGNMENTS Assignment-IV = 2.5 Each Case Study

CASE STUDY - I
Deep Sea Fishing Co. Ltd. concluded an export order for 10 tones of packagedfish to USA on 20th January. The contract provided supply of contracted quantity in ten shipments, commencing from February itself. US importer had agreed on a price of $ 1825 per tone. The terms of payment were (i) 25% of entire contract value in advance on signing, and (ii) balance 75% as and when each shipment takesplace.Re/$ratesontheapplicabledatesduringthecontractperiodwereasunder:
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 20thJan 45.50 July 45.00 Feb 45.40 Aug 45.50 March 45.30 Sep 45.70 April 45.20 Oct 45.60 May 45.30 November 45.40 June 45.20

Required: (a) Whatwastheestimatedrupeeinflowatthetimeofsigningthecontract? (b) Whatistheinflowultimatelyregisteredbythecompany,oncompletionofthecontract? (c) Isthereadifference? (d) Nametheriskinvolved.

CASE STUDY-II
AnIndianinvestorinvestsinUSbondswithafacevalueof$10,000.Thebondshaveamarketpriceof$ 10,500 by the yearend and fetch $ 700 as interest during the year. $ appreciates by 3% during this period.Simultaneously,theinvestorinvestsinGermanbondswithafacevalueof30,000fetching3,000 as interest and the market price of the bonds going up to 30,500 during the year. depreciates by 2% duringthisperiod. Calculateportfolioreturn.

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