International Financial Management
|Course Number:||BUSADMIN 5650|
|Course Name:||International Finance (Online)|
|Course Description:||Global financial markets emerged in the late 1980s and 1990s. This course explores these new markets with an emphasis on the basics and from the perspective of the financial manager. Four basic topics areas to be covered are foundations of international financial management, world financial markets and institutions, financial management of the multinational firm, and managing the foreign exchange exposure of the firm.|
|Prerequisites:||BUSADMIN 5620 or equivalent, or permission of the instructor|
|Program:||Master of Science in Project Management|
NOTE: The information below is representative of the course and is subject to change. The specific details of the course will be available in the Desire2Learn course instance for the course in which a student registers.
Course Learning Outcomes
Upon successful completion of this course, students will be able to:
- Describe the key theories that justify international business.
- Explain how international trade flows are influenced by economic factors and other factors.
- Describe the background and corporate use of the international markets.
- Explain how exchange rate movements are measured.
- Describe how the currency future/option contracts are used to speculate or hedge based on the anticipated exchange rate movements.
- Explain how government intervention in the foreign exchange market can affect economic condition.
- Explain the concept of interest rate parity and how it prevents arbitrage opportunities.
- Explain the purchasing power parity (PPP) theory and the International Fisher Effect (IFE) theory and its implications for exchange rate changes.
- Explain how firms can benefit from forecasting exchange rates and the most common techniques used for forecasting.
- Discuss the relevance of an MNC’s exposure to exchange rate risk.
- Explain how to hedge long-term transaction exposure.
- Compare various techniques used to hedge payables/receivables.
Unit 1 provides an overview of the multinational corporation (MNC) and introduces the environment in which it operates. It helps us understand the goals of the MNS, the international flow of funds between countries, the international financial markets, and the currency futures and options markets.
Unit 2 explains the critical relationships that influence the change of exchange rates. It covers the influences on exchange rates from governments, explores the relationships among foreign currencies, and explains the impact of inflation on exchange rates and the impact of interest rate movements on exchange rates.
Unit 3 discusses the various functions involved in managing exposure to exchange rate risk. It introduces various methods used to estimate exchange rates and discusses the currency hedge strategies can be use by an MNC.
Exams: 11 quizzes
Quizzes are administered online and there is a quiz for each of the eleven lessons. Quizzes are divided into two groups: practice (ungraded) and graded quizzes. The quiz questions are entirely multiple-choice. They reflect the material contained in the textbook, lecture notes and may be similar to homework problems. Therefore, I encourage you to complete the homework prior to taking the quiz. The quizzes are open-book, open-note. Each quiz contains ten questions for a total of 10 points. The time limit on the quizzes is two hours with a grace period of five minutes.
The homework is ungraded and detailed solutions have been provided to enhance your learning.
Every lesson has a discussion question assignment with a due date. There are two kinds of discussion assignments: individual discussion assignments and group discussion assignments. Individual discussion question assignments are worth 10 points and group discussion question assignments are worth 20 points. The points are awarded based on the relevance of your posting and not necessarily its length.
There are five 100-point cases assigned in this course. The cases have been assigned from the specific lessons. The case study reflects your understanding about the lesson materials. It is important to finish all the required reading and assignments prior tackling the problems. Please refer to your syllabus and the specific lesson for more information. Each team will have one week of time to finish the case and submit by the due dates.
Teams will be rotated throughout the course, if possible. I will be browsing your team work area from time to time. Shirkers will be kicked off the team and will need to complete the casework on their own. Please contact me if you have a shirker on your team. Team members will have the opportunity to evaluate others contribution after finishing the case solution. The peer evaluation form for each case must be completed and submitted by the due dates..
Team members are responsible for submitting peer evaluation forms after completing each case (five individual peer evaluations). As a team member you have to rate yourself and rate each member of your team based on the criteria suggested in the evaluation form. The total Peer evaluations are worth 50 points. Your final peer evaluation points will be assigned at the end of the semester and will reflect an average of your total peer evaluation points.
|Individual Discussions (9 @ 10 pts. each)||90 points|
|Group Discussions (2 @ 20 pts. each)||40 points|
|Quizzes (11 @ 10 pts. each)||110 points|
|Team Assignments (5 @ 100 pts. each)||500 points|
|Lessons 2, 3, 4, 6 & 7|
|Peer Evaluations (5 @ 10 pts. each)||50 points|
|Total Undergraduate:||790 points|
|Individual Graduate Assignment||50 points|
|Total Graduate:||840 points|
|A||90% - 100%|
|B||80% - 89%|
|C||70% - 79%|
|D||60% - 69%|
|F||0% - 59%|