International financial management - Essay Example

Only on StudentShare

Extract of sample
International financial management

Forward contracts can be traded on recognized markets, whilst futures contracts can not Ans-9) (a). Enter into a 90-day forward contract to sell US Dollars for Euros Ans-10) (e). Insufficient data given to enable the calculation to be made Section B Q1 a) The political risk refers to the scenario where the economic yield would be influenced and undergoes due to the uncertain changes in political environment that cause volatility in the state (MCKELLAR, Robert, 2012, pp. 36). Any uncertain circumstances directly impact the investment returns that could be ranging from switching the governments, change in regulation bodies, amendments in foreign policy or military state of affairs (OVERHOLT, William H., 1982, pp.74 ). It is a common consensus that political risk cannot be measured but it can be assessed. This particular statement is quite right as political risk cannot be measured, because there is no method or tool available from which one can assess the level and proportion of risk found under political uncertainty (BRINK, Charlotte H, 2004,pp. 152). ...
Download paper


International Financial Management [Author’s Name] [Institution’s Name] Section-A Ans-1) (d). the rate given is the rate for dealing directly with a financial institution Ans-2) 1.7475 * (1+0.99%) = 1.7575 – 82 (c). 1.7575 - 82 Ans-3) (d). the Interest Rate Parity Theory Ans-4) Bid rate at Intercontnental Bank = 1.6685 Bid Rate at MegaBank = 1.6585 Ask Rate Intercontenantal Bank = 1.6695 Ask Rate MegaBank = 1.6595 If one buys from the Mega Bank, then he will get this price 1.6595 And sell on the rate of 1.6685, and then arbitrage profit of 5,432 could be gain accordingly (b)…
Author : blanca22

Related Essays

International Financial Management
12 pages (3012 words) Essay
Financial Management in Multinational Organizations
10 pages (2510 words) Research Paper
International Financial Management
7 pages (1757 words) Essay
international financial management
9 pages (2259 words) Essay
International Financial Management
10 pages (2510 words) Essay
International Financial Management
10 pages (2510 words) Essay
International Financial Management
10 pages (2510 words) Assignment
Got a tricky question? Receive an answer from students like you! Try us!