INTERNATIONAL FINANCE

Course Objectives

On completion of the course, the learner should be able to

  • To introduce the environment of international finance and its implications on international business.
  • To apply the principles behind measuring and managing the firm’s exchange risk exposure from an accounting, economic and operational standpoint.
  • To integrate the global developments with the changing business environment in India.
  • To recognize the strategies for accessing international capital markets and evaluate the decisions on cost–benefit basis.

UNIT I Introduction to International Finance

Overview of Global Business Environment – History of Monetary system’s – Evolution and practices in Foreign Exchange Markets – International financial markets.

UNIT II Exchange Rate Theories

Parity Theory and conditions – Determination of Exchange Rate – types of exchange rates – Steps and Procedures that have to be followed for calculating Bill rate and Exchange rates.

UNIT III Risk in International Finance

Exposure and Risk Management – hedging – speculation – arbitrage – internal and external techniques of hedging – derivatives – meaning – significance – types

UNIT IV Regulatory Framework

Regulatory Framework for International Finance – Short term and long term financial management in a global set–up – treasury functions.

UNIT V International Capital Budgeting

International Project Appraisal – Relevance of Accounting and Taxation in International Business

Learning Resources

  • Jeff Madhura, “International Financial Management”, 10th edition, Cengage Learning, 2010.
  • Michael Moffett, Arthur Stonehill, David Eiteman, “Fundamentals of Multinational Finance”, International Edition, 4th Edition, Pearson Publications, August 2011,
  • Cheol S. Eun And Bruce G. Resnick, “International Financial Management”, Tata McGraw Hill, 2010.
  • Apte P.G, “International Financial Management”, 6th edition, Tata McGraw Hill, 2011.

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