International Finance Questions-
Q1. What are International debt sources of funds? Why are they important for success of large Indian companies? What are the risks associated and how can they be dealt?
Q2. How does Project feasibility using NPV different when it comes to Multinational enterprises? Describe the APV technique.
Q3. Differentiate between different types of ADR and GDR. Which type of ADR's is commonly used by Indian companies? How are prices determined for ADR issue?
Q4. Spot rates in NY are
USD/100 JY 1.01250.
USD/100 INR 1.62550
Determine:
a. The spot quotations in India for JY if spread is 0.2%
b. Determine premium/ discount on JY if forward quotes for 60 days are USD/100 JY 1.01375.
c. Forward rates (INR) for 60 days in NY if USD is at annualized premium of 4%
d. Spot Rates of USD in Mumbai if spread is 0.3%
Q5. On November 20th, you are requested by your export customer to negotiate 45 days bill on New York for $ 75,000. In New York, the quotations are
Spot $/€ 1.3855/1.38725
1 month forward 50/45
2 month forward 90/80
3 months forward 125/110
Interbank market rate in Mumbai are
Spot INR/ € 99.9850/100.0125
Spot/ November 600/700
Spot/ December 800/900
Spot/ January 900/1050
Spot/ February 1200/1400
Determine the Quotations if Exchange margin is 0.15% and transaction period is 25 days.