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Management Programme
ASSIGNMENT
SECOND
SEMESTER
201
6
MS
-
4
5
:
International Financial Management
School of Management Studies
INDIRA GANDHI NATIONAL OPEN UNIVERSITY
MAIDAN GARHI,
NEW DELHI
–
110 068
M
S
-
4
5
ASSIGNMENT
Course Code
:
MS
-
4
5
Course Title
:
International Financial Management
Assign
ment Code
:
MS
-
4
5/
TMA/
SEM
-
II /201
6
Coverage
:
All Blocks
Note:
Attempt  all  the
questions  and  submit  this assignment  on  or  before
31
st
October,  201
6
to
the
coordinator of your study cent
r
e
.
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.
E
xplain 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 di
fferent 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
diffe
rences 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 w
hich influence such transfers.