1. What are the main features of the exchange rate regime that was designed at Bretton Woods? Explain and distinguish between Fixed Exchange Rate and Floating Exchange Rate system. Which one is more suitable and why?
2. Explain the Purchasing Power Parity Theory with the help of an example. Can there be deviations also from Purchasing Power Parity relationship? If so, what factors are responsible for the same?
3. What do you understand by Exchange Rate Exposures? Describe different types of exchange rate exposures and the techniques used to manage them.
4. Why is cost of capital important for a firm? Explain the reasons for variations in the cost of capital across different countries. Describe the factors contributing to differences in the risk-free rate and the risk premium
5. How is working capital management in multinational enterprises different from that of domestic enterprises? Discuss the transactions incorporated under intra-corporate transfer of funds and the variables which influence such transfers.
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