Q1. Describe the relationship between the exchange rates, interest rates and inflation rates.
Q2. Distinguish between the Future and option hedge.
Q3. Distinguish between the Forward market and Future hedge.
Q4. Illustrate the meaning of the Foreign Exchange Risk Management?
Q5. Write down the fundamental tools to manage the risk?
Q6. Explain how the money market hedge can be employed to cover the foreign exchange risk?
Q7. Explain how the future contract and futures contract work? Describe the working method.
Q8. Firms dealing in foreign exchange are exposed to various types of risk. Describe the exposures and risk thereof.
Q9. Illustrate the meaning of currency swaps? Explain how it can be employed to hedge the exchange risk?
Q10. Describe the various methods of measuring the translation exposure?