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ST. JOSEPH’S COLLEGE OF COMMERCE (AUTONOMOUS)
END SEMESTER EXAMINATION – APRIL 2014
M.I.B. – III SEMESTER
INTERNATION FINANCIAL MANAGEMENT
Duration : 3 HOURS Max. Marks: 100
SECTION – A
I) Answer SEVEN questions from the following : (7x 5 = 35)
1. What is balance of payments?
2. What is cross border finance?
3. What are the techniques to appraise projects?
4. What are the various risks prevailing in international transactions?
5. Write a note on Capital budgeting?
6. Why does disequilibrium in BOP exist?
7. How is international financial management different from domestic financial
management?
8. What are the factors effecting exchange rates?
9. What is the difference between risk and exposure with respect to foreign
exchange management?
10. What is translation exposure?
SECTION – B
II) Answer any THREE questions from the following (3×15 = 45)
11. Why do companies enter global markets?
12. Critically analyse the statement” NPV is a simple method of assessing projects”
13. Explain the factors that discourage FDI in India?
14. What are forward rate agreements?
15. What are the risks faced by multinational companies?
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SECTION – C
III) Compulsory question. (20 marks)
16.
Big Oil is wondering whether to drill for oil in Westchester Country. The
prospectus is as follows:
Depth
of
Total Cost
Millions of Cumulative
PV of Oil (If found)
Millions of
Well
Feet Dollars
Probability
of Dollars
Finding Oil
2000 4 0.5 10
4000 5 0.6 9
6000 6 0.7 8
Draw a decision tree showing the successive drilling decisions to be made by Big
Oil. How deep should it be prepared to drill?
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