International Financial Management 6 edition Chapter 8--Solution
财务管理系中英对照
财务管理系中英对照一、财务管理系介绍财务管理系是大学财务管理学科的重要组成部分，主要培养具备扎实的财务管理理论和实践技能的高级财务管理人才。
本文将介绍财务管理系相关的课程以及一些常用术语的中英对照。
二、财务管理系课程介绍及中英对照1.会计学（Accounting）：研究财务信息的获取、处理、分析和报告的学科。
2.财务管理（Financial Management）：研究如何优化资金的利用和配置，以实现经济目标。
3.财务分析（Financial Analysis）：通过对财务报表和其他金融数据的分析，评估企业的财务状况和经营绩效。
4.投资管理（Investment Management）：研究如何有效地投资和管理资产，以实现最大的回报。
5.资本市场理论（Capital Market Theory）：研究金融市场的运作规律，分析投资组合和资本定价等问题。
6.国际财务管理（International Financial Management）：研究跨国企业在全球经济环境下的财务决策和管理策略。
7.税务管理（Tax Management）：研究如何合法合规地进行税收规划和管理。
8.风险管理（Risk Management）：研究如何识别、评估和应对各种风险，保护企业的利益。
9.公司财务（Corporate Finance）：研究公司筹资、投资和分红等财务决策问题。
10.财务工程（Financial Engineering）：研究如何利用衍生工具和金融产品进行风险管理和创新。
三、常用财务管理术语中英对照1.资产（Assets）2.负债（Liabilities）3.所有者权益（Owner’s Equity）4.营业收入（Revenue）5.营业成本（Cost of Goods Sold）6.总成本（Total Cost）7.利润（Profit）8.货币资金（Cash）9.应收账款（Accounts Receivable）10.存货（Inventory）11.负债率（Debt Ratio）12.周转率（Turnover）13.偿债能力（Solvency）14.盈利能力（Profitability）15.现金流量（Cash Flow）16.投资回报率（Return on Investment）17.财务分析（Financial Analysis）18.财务报表（Financial Statements）19.利润表（Income Statement）20.资产负债表（Balance Sheet）以上仅为财务管理系课程和常用术语的一部分中英对照，财务管理是一个涉及众多概念和方法的学科，需要系统学习和实践运用才能掌握。
英国留学国际金融专业
英国留学国际金融专业英国留学金融专业详解分类及介绍国外关于金融专业的设置，是两方面都有。
一、以微观为主，也就是研究与公司个体有关的投资、融资等行为。
另一方面就是和国内类似的宏观金融的研究。
专业细分英国大学的金融专业按细分不同通常设置在商学院、经济学院或数学学院。
在参考专业排名时需要考虑会计与金融、经济、商学三个方向。
金融专业细分可分为：金融学、公司金融、金融与投资、国际金融、银行与金融、金融与管理、会计与金融、风险管理、房地产金融与投资、金融与经济、金融工程。
金融学：对金融各个细分领域的综合介绍。
下面以曼彻斯特大学为例来看下金融学专业的课程设置：第一学期必修课：Introductory Research Methods for Accounting and Finance; 会计与金融学方法导论Essentials of Finance;金融学精要Derivative Securities衍生证券选修一门：Portfolio Investment证券投资International Macroeconomics and Global Capital Markets国际宏观经济学与全球资本市场Foundations of Finance Theory金融学基础第二学期Financial Econometrics金融计量经济学Advanced Empirical Finance高级实证金融学Corporate Finance; 公司金融选修一门International Finance国际金融Financial Statement Analysis财务报表分析Real Options in Corporate Finance公司金融中的实物期权Mergers and Acquisitions: Economic and Financial Aspects关于企业并购的经济金融思考Dissertation毕业论文公司金融：解决以公司财务、公司融资、公司治理为核心的公司治理结构方面的问题，综合运用各种形式的金融工具与方法，进行风险管理和财富创造。
Intermediate Financial Management
《中级财务管理》Intermediate Financial Management教学大纲Part ⅠTeaching Requirements1. Course TypeRequiredFor Third-year undergraduates majoring in Financial Management2. Pre-coursesFundamental Financial Management, Accounting, Business Management, Economics3. Class hours/Credits54 /3Part Ⅱ: Course ContentsCourse OverviewThis course is continued with fundamental financial management. Ihe same textbook are used in this semester. The course covers four parts of textbook. Part Ⅲcovers the valuation of stocks and bonds. Part IV applies the concepts covered in earlier chapters to decisions related to fixed asset investments. Part Ⅴdiscusses how firms should finance their long-term assets. In part Ⅵ, the focus shifts from long-term, strategic decisions to short-term, day-to-day operating decisions. Specific contentsⅠ. Financial AssetsThis part covers the valuation of stocks and bonds. Chapter 8 focuses on bonds, and Chapter 9 considers stocks. Both chapters describe the relevant institutional details, then explain how risk and time value jointly determine stock and bond prices.Chapter 8 Bonds and their valuationThis chapter is to describe the different types of bonds governments and corporations issue, explain how bond prices are established, and to discuss how investors estimate the rates of return they can expect to earn. We will also discuss the various types of risks that investors face when they buy bonds.Contents:1.Who issues bonds?2.Key characteristics of bonds3.Bond valuation4.Bond yields5.Bonds with semiannual coupons6.Assessing the riskiness of bond7.Default risk8.Bond marketsChapter 9 Stocks and their valuationThis chapter shows how stock value are determined, and also how investors go about estimating the rates of return they expect to earn.Contents:1.Legal rights and privileges of common stockholders2.Types of common stock3.The market for common stockmon stock valuation5.Constant growth stocks6.Expected rate of return on a constant growth stock7.Valuing stocks that have a nonconstant growth rate8.Valuate the entire corporation9.Stock market equilibrium10.Actual stock prices and returns11.Preferred stockⅡ. Investing in Long-Term AssetsChapter 10 The Cost of CapitalChapter 10 uses the rate of return concepts covered in previous chapters, along with the concept of the weighted average cost of capital (WACC), to develop a corporate cost of capital for use in capital budgeting.Contents:1. E xplain what is meant by a firm’s weighted average cost of capital.2. Define and calculate the component costs of debt and preferred stock.3. Explain why retained earnings are not free and use three approaches to estimate the component cost of retained earnings.4. Briefly explain why the cost of new common equity is higher than the cost of retained earnings, calculate the cost of new common equity, and calculate the retained earnings breakpoint--which is the point where new common equity would have to be issued.5. Briefly explain the two alternative approaches that can be used to account for flotation costs.6. Calculate the firm’s composite, or weighted average, cost of capital.7. Identify some of the factors that affect the overall, composite cost of capital.8. Briefly explain how firms should evaluate projects with different risks, and the problems encountered when divisions within the same firm all use the firm’s composite WACC when considering capital budgeting projects.9. List and briefly explain the three separate and distinct types of risk that can be identified, and explain the procedure many firms use when developing subjective risk-adjusted costs of capital.10. List some problem areas in estimating the cost of capital.Chapter 11 The basics of capital budgetingContents:1. Discuss difficulties and relevant considerations in estimating net cash flows, and explain the four major ways that project cash flow differs from accounting income.2. Define the following terms: relevant cash flow, incremental cash flow, sunk cost, opportunity cost, externalities, and cannibalization.3. Identify the three categories to which incremental cash flows can be classified.4. Analyze an expansion project and make a decision whether the project should be accepted on the basis of standard capital budgeting techniques.5. Explain three reasons why corporate risk is important even if a firm’s stockholders are well diversified.6. Identify two reasons why stand-alone risk is important.7. Demonstrate sensitivity and scenario analyses and explain Monte Carlo simulation.8. Discuss the two methods used to incorporate risk into capital budgeting decisions.Chapter 12 Cash flow estimation and risk analysisContents:1. Use the replacement chain method to compare projects with unequal lives.2. Explain why conventional NPV analysis may not capture a project’s impact on the firm’s opportunities.3. Define the term option value, and identify four different types of embedded real options.4. Explain what an abandonment option is, and give an example of a project that includes one.5. Explain what a decision tree is and provide an example of one.6. Explain what an investment timing option is, and give an example of a project that includes one.7. Explain what a growth option is, and give an example of a project that includes one.8. Explain what a flexibility option is, and give an example of a project that includes one.9. List the steps a firm goes through when establishing its optimal capital budget in practice.Chapter 13 Other topics in capital budgetingContents:1. Explain why capital structure policy involves a trade-off between risk and return, and list the four primary factors that influence capital structure decisions.2. Distinguish between a firm’s business risk and its financial risk.3. Explain how operating leverage contributes to a firm’s business risk and conduct a breakeven analysis, complete with a breakeven chart.4. Define financial leverage and explain its effect on expected ROE, expected EPS, and the risk borne by stockholders.5. Briefly explain what is meant by a firm’s optimal capital structure.6. Specify the effect of financial leverage on beta using the Hamada equation, and transform this equation to calculate a firm’s unlevered beta, bU.7. Illustrate through a graph the premiums for financial risk and business risk at diffe rent debt levels.8. List the assumptions under which Modigliani and Miller proved that a firm’s value is unaffected by its capital structure, then explain trade-off theory, signaling theory, and the effect of taxes and bankruptcy costs on capital structure.9. List a number of factors or practical considerations firms generally consider when making capital structure decisions.10. Briefly explain the extent that capital structure varies across industries, individual firms in each industry, and different countries.Ⅲ. CAPITAL STRUCTURE AND DIVIDEND POLICYChapter 14 Capital stucture and leverageContents:1. Define target payout ratio and optimal dividend policy.2. Discuss the three theories of investors’ dividend preference: (1) the dividend irrelevan ce theory, (2) the “bird-in-the-hand” theory, and (3) the tax preference theory; and whether empirical evidence has determined which theory is best.3. Explain the information content, or signaling, hypothesis and the clientele effect.4. Identify the two components of dividend stability, and briefly explain what a “stable dividend policy” means.5. Explain the logic of the residual dividend policy, and state why firms are more likely to use this policy in setting a long-run target than as a strict determination of dividends in a given year.6. Explain the use of dividend reinvestment plans, distinguish between the two types of plans, and discuss why the plans are popular with certain investors.7. List a number of factors that influence dividend policy in practice.8. Discuss why the dividend decision is made jointly with capital structure and capital budgeting decisions.9. Specify why a firm might split its stock or pay a stock dividend.10. Discuss stock repurchases, including advantages and disadvantages, and effects on EPS, stock price, and the firm’s capital structure.Chapter 15 Distributions to shareholders dividends and share repurchasesContents:1. Define basic working capital terminology.2. Calculate the inventory conversion period, the receivables collection period, and the payables deferral period to determine the cash conversion cycle.3. Briefly explain the basic idea of zero working capital.4. Briefly explain how a negative cash conversion cycle works.5. Distinguish among relaxed, restricted, and moderate current asset investment policies, and explain the effect of each on risk and expected return.6. Explain how EVA methodology provides a useful way of thinking about working capital.7. List the reasons for holding cash.8. Construct a cash budget, and explain its purpose.9. Briefly explain useful tools and procedures for effectively managing cash inflows and outflows.10. Explain why firms are likely to hold marketable securities.11. State the goal of inventory management and identify the three categories of inventory costs.12. Identify and briefly explain the use of several inventory control systems.13. Monitor a firm’s receivables position by calculating its DSO and reviewing aging schedules.14. List and explain the four elements o f a firm’s credit policy, and identify other factors influencing credit policy.ⅣWORKING CAPITAL MANAGEMENTChapter 16 Mananging current assetsContents:1. Identify and distinguish among the three different current asset financing policies.2. Briefly explain the advantages and disadvantages of short-term financing.3. List the four major types of short-term funds.4. Distinguish between free and costly trade credit, calculate both the nominal and effective annual percentage costs of not taking discounts, given specific credit terms, and explain what stretching accounts payable is and how it reduces the cost of trade credit.5. Describe the importance of short-term bank loans as a source of short-term financing and discuss some of the key features of bank loans.6. Calculate the effective interest rate for (1) simple interest, (2) discount interest, (3) add-on interest loans; and explain the effect of compensating balances on the effective cost of a loan.7. List some factors that should be considered when choosing a bank.8. Explain why large, financially strong corporations issue commercial paper, and why this source of short-term credit is typically less reliable than bank loans if the firm gets into financial difficulties.9. Define what a “secured” loan is and what type of collateral can be used to secure a loan.Chapter 17 Financing current assetsContents:1. Briefly explain the following terms: mission statement, corporate scope, corporate purpose, corporate objectives, and corporate strategies.2. Briefly explain what operating plans are.3. Identify the six steps in the financial planning process.4. List the advantages of computerized financial planning models over “pencil-and-paper” calculations.5. Discuss the importance of sales forecasts in the financial planning process, and why managers construct pro forma financial statements.6. Briefly explain the steps involved in the percent of sales method.7. Calculate additional funds needed (AFN), using both the projected financial statement approach and the formula method.8. Identify other techniques for forecasting financial statements discussed in the text and explain when they should be used.Part Ⅲ：Teaching MethodBased on the integrative problems of each chapter to lecture and discussPart ⅣGradingHomework assignments are due at the beginning of class following the class in which they are assigned, unless otherwise indicated. There will be a final exam and a project due at the end of the course. Class participation is expected and students will be called upon in class. Final grades are determined by the following formula:Grade =0.10(attendance)+0.10(homework) +0.10(quizzes) + 0.70(final)Part ⅤTextbook and Reference BooksTextbookEugene F. Brigham, and Joel F. Houston, Fundamentals of financial management9th edition by CITIC Publishing HouseReference BooksKeown, Martin, Petty, and Scott, Financial Management: Principles and Applications, Ninth Edition, Pearson Education, Inc., 2002Stephen A. Ross, Randolph W. Westerfield, and Bradford D. Jordan, Fundamentals of corporate finance (six edition) 2002 by China Machine Press.《公司理财精要》，斯蒂芬·罗斯等著，张建平译，人民邮电出版社，2003年1月《财务管理原理》，(英)理查德·布雷利（Richard A·Brealey）(美)斯图尔特·C·迈尔斯（Stewart C·Myers）机械工业出版社英文版原书第6版。
国际财务管理(原书第8版)课件PPTEun_CH10_Accessible
• Fixed Assets
– Net fixed assets of Current/Noncurrent, Monetary/Nonmonetary and Temporal: $1,000 is the Historic rate
– Current assets translated at the spot rate. – Noncurrent assets translated at the historical
rate in effect when the item was first recorded on the books.
© McGraw-Hill Education.
10-10
Temporal Method (2 of 3)
• Items carried on the books at their current value are translated at the spot exchange rate. e.g. €2 = $1
• Balance sheet account are translated at the current spot exchange rate if they are carried on the books at their current value.
• Items that are carried on the books at historical costs are translated at the historical exchange rates in effect at the time the firm placed the item on the books.
Contemporary Financial Management 10th现代财务管理英文版全套习题
Contemporary Financial Management 10th现代财务管理英文版全套习题ContentsChapter 1 The Role and Objective of Financial Management 1 Chapter 2 The Domestic and International Financial Marketplace 13 Appendix 2A Taxes 26Chapter 3 Evaluation of Financial Performance 31Chapter 4 Financial Planning and Forecasting 51Chapter 5 The Time Value of Money 66Appendix 5A Continuous Compounding and Discounting 95 Chapter 6 Analysis of Risk and Return 99Chapter 7 Fixed Income Securities: Characteristics and Valuation 127 Chapter 8 Common Stock: Characteristics, Valuation, and Issuance 153 Chapter 9 Capital Budgeting and Cash Flow Analysis 179 Chapter 10 Capital Budgeting: Decision Criteria and Real Option Considerations 202 Appendix 10A Mutually Exclusive Investments Having Unequal Lives 221 Chapter 11 Capital Budgeting and Risk 228Chapter 12 The Cost of Capital 246Chapter 13 Capital Structure Concepts 270Chapter 14 Capital Structure Management in Practice 285 Chapter 15 Dividend Policy 306Chapter 16 Working Capital Policy and Short-Term Financing 327 Chapter 17 The Management of Cash and Marketable Securities 344 Chapter18 Management of Accounts Receivable and Inventories 360 Chapter 19 Lease and Intermediate-Term Financing 376 Chapter 20 Financing with Derivatives 388Appendix 20B Bond Refunding Analysis 404Chapter 21 Risk Management 408Chapter 22 International Financial Management 415Chapter 23 Corporate Restructuring 425Chapter 1The Role and Objective of Financial ManagementMULTIPLE CHOICE1. The primary objective of the firm is:a. Shareholder wealth maximizationb. Social responsibilityc. Long run survivald. Profit maximizationANS: A OBJ: TYPE: Fact TOP: A Foundation Concept2. The limitations of the profit maximization goal include:a. It lacks a time dimension (i.e., it is static)b. It fails to consider riskc. The definition of profit is ambiguousd. All the above are limitationsANS: D OBJ: TYPE: FactTOP: Maximization of shareholder wealth: Managerial strategies3. The shareholder wealth maximization goal states that management should seek tomaximize the _______ of the expected future returns to the owners of the firm.a. Future valueb. Compound valuec. Percentage valued. Present valueANS: D OBJ: TYPE: Fact TOP: A Foundation Concept4. Shareholder returns can take the form ofa. Periodic dividend paymentsb. Proceeds from the sale of the stockc. Periodic interest paymentsd. Periodic dividend payments and proceeds from the sale of the stockANS: D OBJ: TYPE: Fact TOP: A Foundation Concept5. Shareholder wealth is measured by the ________ of the shareholders' common stockholdings.a. Book valueb. Market valuec. Historic valued. Compound valueANS: B OBJ: TYPE: Fact TOP: A Foundation Concept6. The objective of maximizing shareholder wealth, as measured by the market value of thefirm's stocka. does not consider the timing of the benefits receivedb. provides a way to consider the risk of the returns being offeredc. benefits only certain stockholdersd. neither considers the timing of the benefits received norbenefits only certainstockholdersANS: B OBJ: TYPE: Fact TOP: A Foundation Concept7. The two most important disciplines on which financial management relies area. accounting and productionb. accounting and marketingc. economics and marketingd. accounting and economicsANS: D OBJ: TYPE: Fact TOP: Financial management and other disciplines8. The most widely accepted objective of the firm is toa. minimize riskb. maximize profitsc. maximize shareholder wealthd. maximize earnings per shareANS: C OBJ: TYPE: Fact TOP: A Foundation Concept9. The ______ the risk of receiving future cash flows, the ______ will be the present valueof those cash flows.a. greater, greaterb. greater, lowerc. lower, lowerd. lower, greaterANS: B OBJ: TYPE: Fact TOP: Risk10. A major advantage of using the maximization of shareholder wealth as the primary goalof the firm is that this goal considersa. the timing and the risk of the expected benefits to be receivedb. the investor's consumption utilityc. the value of closely held partnershipsd. all the aboveANS: A OBJ: TYPE: Fact TOP: A Foundation Concept11. The primary reason for the divergence between the shareholder wealth maximization goaland the actual goals pursued by management has been attributed toa. separation of social responsibility and stakeholders' concernsb. separation of ownership and controlc. separation of personal welfare and long-run profit goalsd. the granting of "golden parachute" contractsANS: B OBJ: TYPE: Fact TOP: Divergent objectives12. Giving top management _______ is one method that ensures managers will act in theinterest of shareholders in merger decisions.a. "golden parachute" contractsb. excellent payc. executive perksd. job securityANS: A OBJ: TYPE: Fact TOP: Divergent objectives13. _____ arise from the divergent objectives between owners and managers.a. Shareholder relationshipsb. Stakeholder problemsc. Creditor problemsd. Agency problemsANS: D OBJ: TYPE: Fact TOP: Agency problems14. Agency costs include all of the following except:a. expenditures to monitor management's actionsb. providing stock as part of management's compensationc. flotation costsd. bonding expendituresANS: C OBJ: TYPE: Fact TOP: Stockholders and managers15. A potential agency conflict can arise between stockholders and creditors because ownersmaya. increase the risk of a firm's investmentsb. decrease the amount of debt outstandingc. decrease the risk of a firm's investmentsd. increase the firm's net worthANS: A OBJ: TYPE: Fact TOP: Stockholders and creditors16. When KKR acquired RJR Nabisco, the ______ in the debt ratio, resulted in a(n) ______in the value of the firm's outstanding bonds.a. decrease, increaseb. increase, increasec. decrease, declined. increase, declineANS: D OBJ: TYPE: Fact TOP: Stockholders and creditors17. Agency problems may give rise to costs that ______ the market value of firms.a. increaseb. decreasec. do not affectd. are not important toANS: B OBJ: TYPE: Fact TOP: Stockholders and managers18. All of the following are problems with the microeconomic profit maximization modelexcept:a. the absence of a time dimensionb. offers financial managers insights to a wide range of problemsc. does not consider the risk of alternative decisionsd. the problem of defining profitsANS: B OBJ: TYPE: FactTOP: Maximization of shareholder wealth: Managerial strategies19. ________ are largely outside of the direct control of managers.a. investment strategiesb. economic environment factorsc. major policy decisionsd. dividend policiesANS: B OBJ: TYPE: Fact TOP: Managerial actions to influence value20. The success of a firm is linked to its stakeholders. This group includes:a. community neighborsb. suppliersc. employeesd. all the aboveANS: D OBJ: TYPE: Fact TOP: Social responsibility concerns21. Techniques identified by John Casey that managers could keep in mind when addressingthe ethical dimensions of a business problem include all of the following except:a. collect all the facts bearing on the problemb. clarify the parameters of the problemc. involve all parties with a financial interest in the outcomed. seek equity for those who may be affectedANS: C OBJ: TYPE: FactTOP: Ethical issues: the practice of financial management22. Many small business owners are _________ diversified with respect to their personalwealth.a. poorlyb. highlyc. welld. 90%ANS: A OBJ: TYPE: FactTOP: Entrepreneurial finance issues: Shareholder wealth maximizat23. __________ deals with economic decisions of individuals, households, and firms.a. Economic accountingb. Microeconomicsc. Blue Chip econometricsd. MacroeconomicsANS: B OBJ: TYPE: Fact TOP: Economics24. Financial management draws heavily on the following related disciplines:a. accountingb. macroeconomicsc. microeconomicsd. all of the aboveANS: D OBJ: TYPE: Fact TOP: Financial management and other disciplines25. The chief financial officer (CFO) normally has responsibilityfor all the following except:a. advertising strategyb. managing interest rate riskc. trading foreign currenciesd. accounting functionsANS: A OBJ: TYPE: Fact TOP: Organization of the financial management function26. The controller normally has responsibility for all _______ related activities, while thetreasurer is normally concerned with ________.a. acquisition, data processingb. tax, cost accountingc. tax, financial accountingd. accounting, expenditure of fundsANS: D OBJ: TYPE: Fact TOP: Organization of the financial management function27. According to the shareholder wealth maximization goal, management should seek tomaximize the __________ of the __________ to owners.a. present value; expected pretax cash flowsb. future value; expected pretax cash flowsc. present value; expected future returnsd. future value; expected future returnsANS: C OBJ: TYPE: Fact TOP: A foundation concept28. Shareholder wealth is measured by the __________.a. book value of the shareholders' common stock holdingsb. market value of the shareholders' common stock holdingsc. book value of the company's assetsd. market value of the company's assetsANS: B OBJ: TYPE: Fact TOP: Determinants of value29. Among the most important agency relationships in the context of finance is (are) therelationship(s) between __________.a. stockholders and creditorsb. management and workersc. stockholders and creditors, and management and workersd. management and creditorsANS: A OBJ: TYPE: Fact TOP: Agency problems30. Protective covenants in a company's bond indentures are used in agency relationshipsinvolving __________.a. stockholders and managersb. stockholders and creditorsc. management and workersd. management and creditorsANS: B OBJ: TYPE: Fact TOP: Stockholders and creditors31. The chief financial officer (CFO) of a corporation normally reports to the_______________________ of the company.a. chairman of the board of directorsb. chief operating officerc. controllerd. chief executive officerANS: D OBJ: TYPE: Fact TOP: Organization of the financial management function32. The ___________ has a goal of serving as a bridge between academic study of financeand the application of financial principles by financial managers.a. Financial Executives Instituteb. Financial Management Associationc. American Finance Associationd. Institution of Financial AnalystsANS: B OBJ: TYPE: Fact TOP: Professional finance affiliation33. All of the following economic environment factors affect stock prices except:a. investment strategiesb. competitionc. tax ratesd. currency exchange ratesANS: A OBJ: TYPE: Fact TOP: Managerial actions to influence value34. The major factors that determine the market value of a company's shares of stock includethe __________ .a. risk of its cash flowsb. timing of its cash flowsc. book value of its assetsd. risk of its cash flows and the timing of its cash flowsANS: D OBJ: TYPE: Fact TOP: Determinants of value35. There is often a divergence between the shareholder wealth maximization goal and theactual goals pursued by management. The primary reason for this is __________.a. geographical dispersion of shareholdersb. separation of ownership and controlc. age differences between managers and shareholdersd. that both have their own agendasANS: B OBJ: TYPE: Fact TOP: Divergent objectives36. The existence of divergent objectives between owners and managers is one example of aclass of problems arising from __________.a. social responsibility concernsb. age differences between managers and ownersc. agency relationshipsd. union-management relationsANS: C OBJ: TYPE: Fact TOP: Agency problems37. The activities of the treasurer include all of the following except:a. financial planningb. tax preparationc. credit analysisd. pension fund managementANS: B OBJ: TYPE: Fact TOP: Organization of the financial management function38. The most important managerial objective is to:a. make MC=MRb. maximize profitsc. minimize agency costsd. none of the aboveANS: D OBJ: TYPE: Fact TOP: A foundation concept39. _______ are important because the financial health of a firm depends on the firm beingable to generate sufficient cash to pay its creditors, employees, suppliers, and owners.a. cash salesb. cash flowsc. cash profitsd. net profitsANS: B OBJ: TYPE: Fact TOP: A foundation concept40. One method of decreasing the cash outflows of a firm is toa. decrease depreciationb. increase capital expendituresc. decrease dividendsd. increase debt repaymentANS: C OBJ: TYPE: Fact TOP: Cash flow41. If a firm shows an accounting net income, thena. it will not have a cash flow problemb. it will not have a problem obtaining a bank loanc. it will be able to repay all current liabilities on timed. none of the aboveANS: D OBJ: TYPE: Fact TOP: Cash flow42. Cash flow concepts are _____ but generally accepted accounting principles are ______ inthe determination of a firm's net income.a. unambiguous, ambiguousb. ambiguous, unambiguousc. ambiguous, also ambiguousd. unambiguous, straightforwardANS: A OBJ: TYPE: Fact TOP: Importance of cash flow43. Accounting-based measures of performance include all the following excepta. return on equityb. cash flowc. return on assetsd. market shareANS: B OBJ: TYPE: Fact TOP: Cash flows and shareholder wealth44. Accounting-based measures of performance _____ subject to short-term manipulation bymanagers; cash flows ______ subject to short-term manipulation.a. are, are notb. are not, arec. are, are alsod. are not, also are notANS: A OBJ: TYPE: Fact TOP: Cash flows and shareholder wealth45. The net present value rule provides appropriate guidance for financial decision makerswhen costs are incurred immediately buta. future cash flows are not known with certaintyb. marginal costs are equal to marginal revenuec. result in a stream of benefits over several future time periodsd. marginal costs are greater then marginal revenueANS: C OBJ: TYPE: Fact TOP: Net present value rule46. Corporate officers normally include all the following except:a. Secretaryb. Chief operating officerc. Treasurerd. Financial analystANS: D OBJ: TYPE: Fact TOP: Corporate organization47. The difference between a firm's annual after-tax operating profit and its total annual costof capital is known as:a. earned incomeb. Economic Value Addedc. Managerial Value Addedd. operating incomeANS: B OBJ: TYPE: Fact TOP: Divergent objectives48. ____ equals the number of shares outstanding times the market price per share.a. Book valueb. Stakeholders wealthc. Total shareholder wealthd. Economic valueANS: C OBJ: TYPE: Fact TOP: A Foundation Concept49. Which of the following companies requires that its top officers own common stock in thecompany that is at least equal to their annual salary.a. Ford Motor Companyb. Tucson Electric Power Companyc. Panhandle Easternd. Anheuser-BuschANS: A OBJ: TYPE: Fact TOP: Divergent Objectives50. The net present value of an investment made by a firm represents the contribution of thatinvestment to the ____ of the firm.a. book valueb. profitc. valued. cash flowANS: C OBJ: TYPE: Fact TOP: Net present value rule51. A major advantage of the corporate form of business over both sole proprietorships andpartnerships is thea. limited liabilityb. reduction in taxesc. ease of formationd. ability to maintain ownershipANS: A OBJ: TYPE: Fact TOP: Corporation52. Which of the following is not an advantage that the corporate form of business has overeither the sole proprietorship or partnership?a. ability to raise capitalb. ease of changing ownershipc. limited liabilityd. elimination of double taxesANS: D OBJ: TYPE: Fact TOP: Corporation53. A major disadvantage of a sole proprietorship is the fact thata. it is expensive to establishb. the owner has unlimited personal liabilityc. it is easy to finance growthd. the owner pays taxes on all the incomeANS: B OBJ: TYPE: Fact TOP: Sole proprietorship54. In a limited partnership, the limited partners may limit their:a. tax liabilityb. liabilityc. tax write-offd. ability to attract new productsANS: B OBJ: TYPE: Fact TOP: Partnership55. Corporate securities represent claims against thea. corporate officers of the firmb. agents of the corporationc. liabilities and net worth of the firmd. assets and future earnings of the firmANS: D OBJ: TYPE: Fact TOP: Corporate securities56. _________ is (are) referred to as a residual form of ownershipin a corporation.a. Common stockb. Preferred stockc. Bondsd. DividendsANS: A OBJ: TYPE: Fact TOP: Corporate securities57. The advantages of the corporate form of organization over both sole proprietorships andpartnerships include ________.a. limited liabilityb. permanencyc. limited liability and permanencyd. lower tax ratesANS: C OBJ: TYPE: Fact TOP: Corporation58. Although this type of business generates less than 6% of the total U.S. business revenue,_____ make up approximately 75% of all businesses.a. general partnershipsb. corporationsc. limited partnershipsd. sole-proprietorshipsANS: D OBJ: TYPE: Fact TOP: Sole proprietorship59. Which of the following is not an advantage of the corporate form of businessorganization:a. unlimited lifeb. unlimited liabilityc. flexibility in ownership changed. ability to raise capitalANS: B OBJ: TYPE: Fact TOP: Corporation60. There are problems with using the “profit maximization” criterion. Which of thefollowing is/are correct?I. Profit maximization has an ambiguous definition of “maximizing profits”.II. Profit maximization fails to consider risk.a. I onlyb. II onlyc. Both I and IId. Neither I nor IIANS: C OBJ: TYPE: Fact TOP: Foundation concept61. Which of the following statements is/are correct?I. Shareholders elect the Chairman of the BoardII. The board of directors has no control over whether or not dividends will be paid.a. I onlyb. II onlyc. Both I and IId. Neither I nor IIANS: D OBJ: TYPE: Fact TOP: Corporate organization62. There are three major factors that determine the market value ofa company’s share ofstock. All of the following are factors EXCEPT:a. Cash flowsb. Sales generatedc. Timing of cash flowsd. Risk taken to generate cash flowsANS: B OBJ: TYPE: Fact TOP: Determinants of value63. Which of the following is an economic principle used in finance?a. Full utilization of data processingb. Marginal analysis where marginal costs are set equal to marginal revenues.c. Accrual basis of recognizing revenues and expensesd. Target capital structureANS: B OBJ: TYPE: Fact TOP: Financial management and otherdisciplines64. The definition of the marginal analysis principle is that financial decisions are made andactions are takena. within the global economic viewpoint.b. with regard to governmental laws and cultural effectiveness.c. when the added benefits exceed the added costs.d. based on the impact of public opinion.ANS: C OBJ: TYPE: FactTOP: Maximization of shareholder wealth: Managerial strategies65. There are three forms of business organization. Which of the following has unlimitedliability?I. CorporationII. General partnershipa. I onlyb. II onlyc. Both I and IId. Neither I nor IIANS: B OBJ: TYPE: Fact TOP: PartnershipESSAY1. Explain the chain of command in a corporation.ANS:The stockholders, who own a pro-rata share of the company, elect the board of directors. The board makes broad decisions affecting the direction of the company, leaving the day-to-day decisions to the corporate officers, who are elected by the board. Corporate officers are: the chairman of the board, the chief executive officer, the chief operating officer, chief financial officer, president, vice-president(s), treasurer and secretary.OBJ: TYPE: Fact TOP: Corporate organization2. There are five compe titive forces that influence an industry’s structure.ANS:1. The threat of new entrants.2. The threat of substitute products3. The bargaining power of buyers4. The bargaining power of suppliers5. The rivalry among current competitorsOBJ: TYPE: Fact TOP: Managerial actions to influence value3. What are the shortcomings in the profit maximization objective asa managerial strategy?ANS:1. Profit maximization lacks a time dimension.2. There are many definitions of profit for a firm. There is much latitude permitted inrecognizing and accounting for costs and revenues.3. There is a question as to which profit is to be maximized: total profit, rate of profit orEPS.4. There is no direct way to consider the risk associated with alternative decisions.OBJ: TYPE: Fact TOP: Maximization of shareholder wealth: Managerial strategiesChapter 2The Domestic and International Financial MarketplaceMULTIPLE CHOICE1. The difference between merchandise exports and imports is known as the __________.a. transaction exposureb. difference in purchasing powerc. merchandise trade balanced. import/export reserveANS: C OBJ: TYPE: Fact TOP: The global economy2. A multinational firm __________.a. has direct investments in manufacturing facilities in more than one countryb. exports finished goods for sale in another countryc. imports raw materials from another countryd. has a manufacturing representative in another countryANS: A OBJ: TYPE: Fact TOP: The global economy3. The interest rate at which banks in the Eurocurrency market lend to each other is knownas the __________ .a. Eurocurrency currency rate (ECR)b. London interbank offer ratec. exchange rated. interest rate parityANS: B OBJ: TYPE: Fact TOP: The Eurocurrency market4. If Japanese yen are deposited in a bank in Paris, the deposits would be called __________a. Eurofrancsb. European Currency Unitc. Eurobondd. EuroyenANS: D OBJ: TYPE: Fact TOP: The Eurocurrency market5. An exchange rate quoted as $1.47 per British pound is known as a __________ quote.a. hedgeb. directc. futuresd. indirectANS: B OBJ: TYPE: Fact TOP: Direct and indirect quotes6. If the spot rate for Swiss francs is $0.6658/franc and the 180-day forward rate is $0.6637,the market is indicating that the Swiss franc is expected toa. strengthen relative to the dollarb. weaken relative to the ECUc. lose value relative to the dollar over the next 6 monthsd. gain value relative to the dollar over the next 6 monthsANS: C OBJ: TYPE: Fact TOP: Forward rates7. Which of the following is not a correct statement about foreign currency futures?a. futures contracts have a standardized maturity dateb. futures contracts are an exchange-traded agreementc. futures contracts are not liquidd. futures contracts are "marked to market" dailyANS: C OBJ: TYPE: Fact TOP: Foreign currency futures8. The most important foreign currency futures market in the United States is the__________.a. Chicago Board of Tradeb. New York Mercantile Exchangec. Commodity Exchanged. Chicago Mercantile ExchangeANS: D OBJ: TYPE: Fact TOP: Foreign currency futures9. The buyer of a foreign currency call option has the __________ a fixed amount of aforeign currency.a. right to sellb. right but not the obligation to buyc. obligation to buy, only at expiration,d. obligation to buyANS: B OBJ: TYPE: Fact TOP: Foreign currency options10. Eurodollars are U.S. dollars that have been deposited ina. foreign banksb. foreign branches of U.S. banksc. foreign subsidiariesd. foreign banks and foreign branches of U.S. banksANS: D OBJ: TYPE: Fact TOP: The Eurocurrency market11. If the exchange rate from U.S. dollars to Canadian dollars is $0.80/Canadian dollar, thenthe exchange rate from Canadian dollars to U.S. dollars isa. 0.80 Canadian $/US dollarb. $1.25 Canadian $/US dollarc. $1.20 Canadian $/US dollard. $8.00 Canadian $/US dollarANS: B OBJ: TYPE: Fact TOP: Direct and indirect quotes12. If the exchange rate from U.S. dollars to Swiss francs is $0.20/franc, then the exchangerate from francs to dollars isa. 0.20 francs/dollarb. 0.80 francs/dollarc. 5.0 francs/dollard. 2.0 francs/dollarANS: C OBJ: TYPE: Fact TOP: Foreign currencies and exchange rates13. If the spot rate (in U.S. dollars) for Japanese Yen is 0.00703 and the 180 day forward rateis 0.00717, then the Yen is trading at a(n) ______.a. expected gainb. premiumc. reciprocald. discountANS: B OBJ: TYPE: Fact TOP: Foreign currencies and exchange rates14. If the forward (direct quote) exchange rate is lower than the spot rate, then the currency issaid to be trading at a ______.a. forward premiumb. forward gainc. forward discountd. forward lossANS: C OBJ: TYPE: Fact TOP: Foreign currencies and exchange rates15. Financial middlemen includea. securities brokersb. securities dealersc. investment bankersd. all of the aboveANS: D OBJ: TYPE: Fact TOP: An overview of the U.S. financialsystem16. The following are listed security exchanges in the United Sates:a. New York Stock Exchangeb. Pacific Exchangec. Cincinnati Exchanged. All the above are listed exchangesANS: D OBJ: TYPE: Fact TOP: Listed security exchanges17. The Standard and Poor's 500 Stock Price Index is a ____ index.a. price weightedb. market value weightedc. price averaged. none of these answers is correctANS: B OBJ: TYPE: Fact TOP: Stock Market Indexes18. Securities not listed on exchanges are said to be tradeda. on the AMEXb. as composite transactionsc. over the counterd. on the regional exchangesANS: C OBJ: TYPE: Fact TOP: Security exchanges and stock market indexes19. Financial intermediaries includea. securities brokersb. commercial banksc. securities dealersd. all of the aboveANS: B OBJ: TYPE: Fact TOP: An overview of the U.S. financial system20. _______ markets deal in long-term securities having maturities greater than one year.a. Creditb. Moneyc. Commodity futuresd. CapitalANS: D OBJ: TYPE: Fact TOP: Money and capital markets21. ______ markets deal in short-term securities having maturitiesof one year or less.a. Creditb. Moneyc. Capitald. Capital and creditANS: B OBJ: TYPE: Fact TOP: Money and capital markets22. Which of the following (if any) are not financial intermediaries?a. commercial bankb. thrift institutionc. securities brokerd. all are financial intermediariesANS: C OBJ: TYPE: Fact TOP: An overview of the U.S. financial system23. In the ________ market, the firm receives the proceeds from the sale of its securities.a. over-the-counterb. secondaryc. fully integratedd. primaryANS: D OBJ: TYPE: Fact TOP: Primary and secondary markets24. A savings and loan association is an example of which type of financial intermediary?。
International-FinancialManagement-6国际财务管理课件
$ 42.70
$ 36.48
$ 29.36
Interest expense:
(12) U.S.
$ 3.00
$ 3.00
$ 3.00
(13) Canadian
C$ 10 = 7.50
C$10 = 8.00
C$ 10 = 8.50
(14) Total
$ 10.50
$ 11.00
$ 11.50
(15) EBT
7
Economic Exposure
• Restructuring may involve:
increasing/reducing sales in new or existing foreign markets,
increasing/reducing dependency on foreign suppliers,
Laker Airways is a British airline that generated much of its revenue in British pounds, a large proportion of its expenses (such as fuel, oil, and debt payments), however, were denominated in dollars. As the dollar strengthened in the foreign exchange market in 1981, Laker needed larger amounts in pounds to cover its dollar-denominated expenses. In January 1981, Laker borrowed $131 millions in the financial markets from a group of U.S. and European banks . The debt was denominated in U.S dollars and therefore had to be repaid in U.S. dollars. Laker’s decision
国际财务管理师(IFMSIFM)报考指南
国际财务管理师（IFM/SIFM）报考指南考试介绍国际财务管理协会（International Financial Management Asso ciation，英文缩写IFMA）是一家专业从事财务管理理论和应用研究、推动财务管理全球化、研究和推广财务管理职业标准的全球性财经专业团体。
其前身国际管理会计师协会（International Management Accountants Association）。
IFMA秉承的一贯宗旨，即：推动财务管理全球化，研究和推广全球适用的财务管理职业知识体系和认证标准，为各国培养现代企业管理所必需的财务管理、资本运作、企业决策、企业管理、专业理财、风险管理、投资决策等方面的中高级专业人才。
IFMA名誉主席为W.J. 菲尔斯爵士，是国际著名投资家、社会活动家，现任国际狮子协会会长，美国北拉斯韦加斯州政府长官。
IFM A在美国设有IFM研究院（IFM Institute，英文缩写IFMI），专业从事于国际财务管理知识体系和职业标准研究，现任院长兼首席科学家詹姆斯.柯曼教授，曾担任纽约大学风险管理系主任，终身教授，是世界著名的财务管理、企业风险管理和风险控制专家。
协会现任轮值主席JD 西蒙.邓教授，拥有法学博士、经济学博士学位，是著名资本运作专家、信用管理专家和律师。
协会实行理事会领导下的国际联动发展模式，各国、各地分支机构执行IFMA的统一标准和规则，共同推动IFMA全球使命的达成。
伴随着工业产业经济在整个经济体系中所占的比例迅速下降，管理会计学在全球范围内走向衰落。
以企业财务管理为核心的财务管理科学逐渐走入广大雇主和财经从业者的视野。
经济结构的变化、资本市场的丰富使得财务管理相对于传统会计的独立性越来越强，对企业发展发挥的作用越来越大。
经济全球化、企业国际化和集团化发展使得跨越国界的投资、融资、兼并拆分活动成为一种普遍的现象和趋势。
国际财务管理协会（IFMA）在全球率先提出国际财务管理师这一全新的职业概念，并通过多年来在前沿国际财务管理理论知识和职业标准新领域的潜心研究，成功面向全球推出国际财务管理师（Internati onal Finance Manager，英文缩写IFM）知识体系和职业标准体系。
国际财务管理(英文版)课后习题答案2
CHAPTER 1 GLOBALIZATION AND THE MULTINATIONAL FIRMSUGGESTED ANSWERS TO END-OF-CHAPTER QUESTIONSQUESTIONS1. Why is it important to study international financial management？Answer：We are now living in a world where all the major economic functions, i。
e., consumption, production，and investment, are highly globalized. It is thus essential for financial managers to fully understand vital international dimensions of financial management. This global shift is in marked contrast to a situation that existed when the authors of this book were learning finance some twenty years ago. At that time，most professors customarily (and safely, to some extent）ignored international aspects of finance。
This mode of operation has become untenable since then.2. How is international financial management different from domestic financial management？Answer: There are three major dimensions that set apart international finance from domestic finance. They are:1。
国际财务管理课后习题答案(第六章)
CHAPTER 6 INTERNATIONAL PARITY RELATIONSHIPSSUGGESTED ANSWERS AND SOLUTIONS TO END-OF—CHAPTERQUESTIONS AND PROBLEMSQUESTIONS1。
Give a full definition of arbitrage。
Answer:Arbitrage can be defined as the act of simultaneously buying and selling the same or equivalent assets or commodities for the purpose of making certain，guaranteed profits。
2。
Discuss the implications of the interest rate parity for the exchange rate determination.Answer：Assuming that the forward exchange rate is roughly an unbiased predictor of the future spot rate，IRP can be written as:S = [(1 + I£）/(1 + I$)］E[S t+1 I t].The exchange rate is thus determined by the relative interest rates，and the expected future spot rate, conditional on all the available information，I t, as of the present time。
One thus can say that expectation is self—fulfilling. Since the information set will be continuously updated as news hit the market，the exchange rate will exhibit a highly dynamic，random behavior。
国际结算教材
国际结算是国际贸易中重要的一环，涉及到不同国家和地区之间的货币支付和结算。
以下是一些建议的教材，这些教材可用于学习国际结算的基本概念和实践：1.《国际贸易与国际结算》（International Trade and International Payments）by PaulKrugman and Maurice Obstfeld:•该教材由两位著名经济学家编写，涵盖了国际贸易和国际结算的基本理论和实践。
它是一本全面介绍国际经济学的教材，也涉及到相关的货币和支付问题。
2.《国际商业与国际金融》（International Business: Environments and Operations）byJohn D. Daniels, Lee H. Radebaugh, and Daniel P. Sullivan:•这本书不仅涵盖了国际商业的方方面面，还包括了国际金融和货币问题，对于理解国际结算的背景和环境非常有帮助。
3.《国际贸易实务与国际结算》（International Trade Practice and Operations）by EmadM. El-Harkous:•该书强调国际贸易操作和实践，特别关注国际结算的具体问题和案例。
适合那些希望深入了解国际贸易操作和结算方面的读者。
4.《国际金融》（International Financial Management）by Jeff Madura:•尽管这本书主要关注国际金融管理，但它涉及到了国际结算的一些方面，特别是涉及到跨国公司在不同国家进行财务管理和结算的问题。
5.《国际贸易法与实务》（International Trade Law and Practice）by Raj Bhala:•这本书侧重于国际贸易法和实务，但也包括了与国际结算相关的法律和合同问题。
请注意，这只是一些建议，具体的教材选择可能根据你的学术水平、课程需求和学科偏好而有所不同。
International Finance 国际金融术语
国际金融术语AAffiliated company 关联公司；联营公司After market 后市Allotment 配股Alternative investment 另类投资American Stock Exchange 美国证券交易所American Commodities Exchange 美国商品交易所American style option 美式期权Amex 美国证券交易所Annual General Meeting 周年大会APEC 亚太区经济合作组织(亚太经合组织) ASEAN 东南亚国家联盟(东盟)Asian bank syndication market 亚洲银团市场Asian dollar bonds 亚洲美元债券Asset Allocation 资产配置Asset Management 资产管理Asset swap 资产掉期BBank, Banker, Banking 银行，银行家，银行业Bank for International Settlements 国际结算银行Basis swap 基准掉期Benchmark 比较基准BIS 国际结算银行Bona fide buyer 真诚买家Bond market 债券市场，债市Bonds 债券，债票Bonus issue 派送红股Bonus share 红股Book runner 投资意愿建档人; 帐簿管理人Bounced cheque 空头支票BP (Basis Point) 基点Break-up valuation 破产清理价值评估Breakeven point 收支平衡点Broker, Broking, Brokerage House 经纪，证券买卖，证券交易，证券行，经纪行Build, Operate and Transfer 建造、经营、转让Build, Own, Operate and Transfer 建造、拥有、经营、转让Build/Supply-Service/Maintain 建造/设备供应-服务/维修Bullish 看涨; 看好行情Buyer's credit 买方信贷（进口）CCall option 认购期权/看涨期权Call protection/provision 赎回保障/条款Call warrant 认购认股权证Callable bond 可赎回债券Cap 上限CAPEX 资本支出Capital base 资本金Capital expenditure 资本支出Capitalization 资本值Capital markets 资本市场，资金市场Capital raising 融资，筹集资金Cash-settled warrant 现金认股权证Cash earnings per share 每股现金盈利Cash flow 现金流量CD 存款证Central Clearing & Settlement System 中央结算及交收系统Certificate of deposit 存款证CFO 财务总监；首席财务官Chicago Board of Trade 芝加哥交易所Chicago Board Options Exchange 芝加哥期权交易所Chicago Mercantile Exchange 芝加哥商品交易所China banking 中国银行业China Capital Markets 中国资本市场，中国资金市场China International Capital Corporation, CICC 中国国际金融有限公司，中金公司China privatization 中国民营化，中国私有化，中国私营化China restructuring 中国重组，中国改组China Securities Regulatory Commission 中国证监会China Stock Markets 中国股票市场，中国股市Claim 索偿Closed-end fund 封闭式基金Co-lead manager 副主承销; 联席主承销Co-manager 副承销商Collar 上下限Commercial loan 商业贷款Commercial paper 商业票据Commodity Exchange, Inc. 商品交易所有限公司(纽约) Company finance 公司融资/公司财务Complex cash flow 复合现金流Compound annual growth rate 复合年增长率Conglomerate 集团/联合大企业/多业公司Construction in progress 在建工程Consumer Price Index 消费物价指数Contingent liability 或有负债Contractual joint venture 合约性合作/合资经营Controlling stake/interest 控股权/权益Conversion of state assets into state shares 国家资产作价入股Conversion premium 转换溢价Conversion price 转换价Converted net collections 转换后净收入Convertible bonds 可转换债券，可换股债券COO 营运总监；首席营运官Corporate finance 企业融资Corporate governance 企业管治，公司治理Coupon rate 孳息率; 票息CPI 消费物价指数Credit facilities 信贷措施Credit line 备用信贷Credit spread 债券息差Cross currency interest rate swap 交叉货币利率掉期CSRC 中国证券监督管理委员会Currency option 货币期权Currency swap 货币掉期Current account deficit 经常帐户赤字Current/liquid ratio 流动比率DDebt issuing vehicles 债务发行工具Debt service coverage ratio 债务偿还比率Default fine 违约罚金Defaulting 违约; 不履行义务Deferred asset 递延资产Deferred charges 递延费用; 待摊费用Deferred tax 递延税项Derivatives 派生产品，衍生产品，衍生金融投资工具Disclosure 信息披露Discount rate 折扣率; 贴现率Dishonoured cheque 空头支票DJIA 道琼斯工业平均指数Dow Jones Industries Average Index 道琼斯工业平均指数DQII 国内合资格机构投资者Dragon bonds 小龙债券Drawing expense in advance 预提费用Dual currency bonds 双货币债券EE-commerce 电子商务E-tailers 网上零售商Earning per share 每股盈利EEC 欧洲经济共同体(欧共体)Emerging market 新兴市场EMU 欧洲货币联盟Engagement letter 委托书EPS 每股盈利Equity, Equities 股本，股权，股票Equity cushion 股本作垫EU 欧洲联盟(欧盟)Eurodollar bonds 欧洲美元债券European Economic Community 欧洲经济共同体（欧共体）European Monetary Union 欧洲货币联盟European Options Exchange 欧洲期权交易所(阿姆斯特丹)European style option 欧式期权European Union 欧洲联盟（欧盟）Ex-coupon 不附息票Exotic option 第二代期权组合（设回报上或下限）Extendible bonds 可延期债券FFederal Open Market Committee 美国联邦公开市场委员会Financial Advisor 财务顾问，融资顾问Financial Management 财务管理Financial Markets, Financial Products 金融市场，金融产品Financial Services 金融服务Floor broker 出市经纪FOMC 联邦公开市场委员会Foreign-funded enterprise 外商投资企业Foreign Exchange 外汇Foreign Exchange Business Operation Permit 经营外汇业务许可证Foreign Exchange Certificate(FEC) 外汇券Foreign exchange mortgage loan 外汇抵押贷款Foreign exchange swap center 外汇调剂中心Forward Rate Agreement 远期利率协议FRA 远期利率协议Franchiser 项目招商人Franchisor 特许专营受权公司FTSE Index 伦敦金融时报指数(又称富时指数) Fund Management 基金管理Futures 期货FX 外汇GG7 七大工业国GAAP 一般公认会计原则Gateway 网关/国际关口局GATT 关税及贸易从协定GDP 国内生产总值GDR 全球预托证券；全球存股证Gearing ratio 运用倍数General Acceptable Accounting Principle 一般公认会计原则General Agreement on Tariffs & Trade 关税及贸易总协定Global bearer warrant 全球不记名认股权证Global Depository Receipt 全球预托证券；全球存股证GNP 国民生产总值Going public 上市，公开上市Greenshoe 绿鞋; 超额发行（选择）权Gross domestic product 国内生产总值Gross national product 国民生产总值Group of Seven 七大工业国HHang Seng China Enterprise Index 恒生中国企业指数(香港)Hang Seng Index 恒生指数(香港)Hedge Fund 对冲基金，套保基金Hedging 对冲; 套保HIBOR 香港银行同业拆借利率HKFE 香港期货交易所有限公司HKMA 香港金融管理局(金管局)HKSAR 香港特别行政区HKSCC 香港中央结算有限公司HKSE 香港证券交易所Holding Company 控股公司Homepage 首页（互联网）Hong Kong Futures Exchange Ltd. 香港期货交易所有限公司Hong Kong Interbank Offer Rate 香港银行同业拆放利率Hong Kong Monetary Authority 香港金融管理局(金管局)Hong Kong Securities Clearing Co. Ltd. 香港中央结算有限公司Hong Kong Special Administrative Region 香港特别行政区Hong Kong Stock Exchange 香港证券交易所HSCEI 恒生中国企业指数(香港)HSI 恒生指数(恒指) (香港)Hybrid cap 混合上限IIAS 国际会计准则Idle funds 闲置资金IMF 国际货币基金IMM 国际货币市场Implicit deflator 隐性通货紧缩指数In-the-money 价内（期权）Income tax 所得税; 入息税; 俸税Indicative price 指示性价格Industrail and Commercial Consolidated Tax 工商统一税Initial Conversion Premium 初次转换溢价Initial Public Offering 首次公开招股发行Institutional investor 机构投资者Intangible asset 无形资产Interest Rate Swap 利率掉期Intergovernmental loan 政府间贷款Intermediary 中介机构; 中介人International Accounting Standards 国际会计准则International Finance 国际融资International Monetary Fund 国际货币基金International Monetary Market 国际货币市场International Organization for Standardization 国际标准化组织International Trust & Investment Corp. 国际信托投资公司(国投公司)Intrinsic value 内在价值Investment, Investing 投资Investment advice, Investment advisor 投资咨询，投资顾问Investment bank, Investment banking 投资银行，投资银行服务IPO 初次公开发行，首次公开招股IRS 利率掉期ISO 国际标准化组织Issuer 发行人ITIC 国际信托投资公司(国投公司)JJoint global coordinator 联席全球协调人Junior mortgage 次级按揭KKorea Composite Index 韩国综合指数LL/C 信用状Lead manager 主承销; 牵头经办人Legal persons shares 法人股Lender 贷款人Letter of credit 信用状Leverage = level of debt/equity 债务水平/比重Leveraged Buy Out 杠杆买断交易，借贷融资收购LIBOR 伦敦银行同业拆借利率Lien 扣押; 扣押权; 留置权LIFFE 伦敦国际金融期货及期权交易所Limited recourse 有限追索权Liquidity ratio 速动比率Lock-Up Agreement 锁定协议London Commodity Exchange 伦敦商品交易所London Interbank Offer Rate 伦敦银行同业拆放利率London International Financial Futures and Options Exchange 伦敦国际金融期货及期权交易所London Metal Exchange 伦敦金属交易所London Stock Exchange 伦敦证券交易所London Traded Options Market 伦敦期权市场Long (position) 长仓Long call 认购长仓Long forward 买远期Long put 认购短仓Loose bond 短期买卖债券Low-Budget Operation 小本经营LSE 伦敦证券交易所LTOM 伦敦期权市场MM&A 合并与收购Management Buy-Out, MBO 管理层买断交易，管理层收购Marche a Terme International de France 法国国际期货及期权市场Marche des Options Negociables de la Bourse de Paris 巴黎证券交易所期货市场Mark-to-market 按市值计价Market Capitalization 市场资本值; 市值Market maker 报价商; 市场庄家Marketable securities 有价证券MA TIF 法国国际期货及期权市场Mature market 成熟市场Medium and long term loans 中长期贷款Medium Term Note 中期票据Memorandum Of Understanding 谅解备忘录Mergers & Acquisitions, M&A 合并和收购，并购MFN 最惠国待遇Monetize 货币化Monopoly Enterprise 垄断/独占企业Moratorium 冻结; 宣布停止还款; 延期付款命令Most Favored Nation 最惠国待遇MOU 谅解备忘录MSCI (Morgan Stanley Capital International) 摩根士丹利资本国际MTN 中期票据Mutual Funds 共同基金，互惠基金NNagoya Stock Exchange 名古屋证券交易所NAPS 国家自动支付系统(中国)NASDAQ 纳斯达克(全国证券交易商自动传报协会)National Association of Securities Dealers Automated Quotations 全国证券交易商自动报价协会(美国) National Automated Payment System 国家自动支付系统(中国)NA V 资产净值Net Asset Value 资产净值Net book value 帐面净值New York Cotton Exchange, Inc. 纽约棉花交易所有限公司New York Futures Exchange 纽约期货交易所New York Mercantile Exchange 纽约商品交易所New York Produce Exchange 纽约农产品交易所New York Stock Exchange 纽约证券交易所Non-callable 不可赎回Non-operating income 非经营收入Non-Performing Loans 不良贷款，逾放款，到期未能偿还贷款Notes receivable 应收票据NPLs 不良贷款，逾放款，到期未能偿还贷款OObligatory right 强制性权利; 债权OD 帐户透支OECD 经济合作及发展组织(经合组织) Off-balance sheet 资产负债表外Off-budgetary 财务预算外Open-end funds 无限额基金Operating concessions 特许经营权Option 期权; 选择权Organization for Economic Co-operation and Development 经济合作及发展组织(经合组织) Osaka Securities Exchange 大板证券交易所OTC 场外交易Out-of-the-money 价外; 失值（期权）Over-The-Counter 场外交易Over Draft 帐户透支PP/E multiple 市盈倍数P/E ratio 市盈率Paid-up capital 实收资本; 已缴足资本Par 票面值Par bonds 有面值债券Paris Bourse 巴黎证券交易所Payoff profile 盈利分析Penalty provision 惩罚/罚金条款Per capita income 人均收入Performance bond 履约保证Physical warrant 实股认股权证Portfolio Management 资产组合管理Post-dated cheque 期票Potential obligation 潜在义务/负债Preference shares 优先股Premium 期权金; 溢价Premium put 溢价赎回Present value 现值Price range 定价区间（发行）Primary debt 一级发行债券Prime rate 最优惠利率Private Banking 私人银行，个人银行Private Equity 私募股本，非上市股本，非上市股票，直接投资Privatization 民营化，私有化，私营化Project approval 立项Project finance 项目融资Promissory note 本票PSE 太平洋证券交易所Public Listing 公开上市，挂牌上市Public welfare fund 福利基金; 公益金Pure play 单一业务公司Put option 看跌期权Putable bond 可退回债券QQIB 合格机构买家Qualified Institutional Buyer 合资格机构买家/投资者Quoted company (= listed company) 上市公司RReal Estate Investment Trusts 不动产投资信托公司Recapitalization 资本重组；再资本化Recourse 追索权Redeem/redemption 赎回REITS 不动产投资信托公司Residual asset 剩余资产Residual value 残值; 剩余价值Restructuring 改组，重组Retail players (= retail investors) 散户/个人投资者Return on asset 资产回报（率）Return on capital employed 已投资资本回报（率）Return on equity 股本回报（率）Revenue-sharing 收入分成Revolving credit 循还贷款Right issue 供股（集资）Rights to the priority distributions 优先分派权Risk rated ratio 风险权重ROA 资产回报（率）Roadshow 路演; 巡回推介说明会ROCE 已投资资本回报（率）ROE 股本回报（率）SS&P 标准普尔S&P 500 Index 标准普尔500种股份指数Samurai bonds 武士债券SEAQ 证券交易所自动报价系统(英国)SEC 证券交易委员会( 美国)Secondary offering 二级发行Securities 证券Shanghai Stock Exchange 上海证券交易所Shareholder value 股东价值Shares 股票，股份Shell company 空壳公司Shenzhen Foreign Exchange Trading Centre 深圳外汇交易中心Shenzhen Stock Exchange 深圳证券交易所Short-term revolving letter 短期循环信用状Short (position) 沽空; 短仓Short and medium term loans 中短期贷款Short forward 卖远期Sidelined investors 抱观望态度投资者Sight draft 即期汇票Sinking fund 偿债基金SOEs 国有企业Sovereign rate 国家信用评级Special stock 特种股票Spread 差额; 差价Standard & Poor 标准普尔State-owned enterprise 国有企业State shares 国家股Stock Broker 股票经纪Stock Exchange Automated Quotations System 证券交易所自动报价系统(英国)Stock Trader, Stock Trading 股票交易商，股票买卖Stocks 股票，股份Strategic Investment, Strategic Investor 策略投资，战略投资，策略投资者，战略投资者Strategic sale 战略出售Strike price 执行价; 行使价Structured financing 结构融资Subordinated debt 次级债务Supply and marketing cooperatives 供销合作社Swap 掉期Syndicated loan 银团贷款TT/T 电汇Take position 坐盘Taxable munis 课税的州政府债券Telegraphic Transfer 电汇Tender bond 投标担保/保证金Tokyo International Financial Futures Exchange 东京国际金融期货交易所Tokyo Stock Exchange 东京证券交易所Toll revenue bond 通行税收入债券Tranche 发行份额/部分Treasury 国库债券，国库券Treasury strips 国库债券条子UUnconditional and irrevocable letter of credit 无条件及不可撤销信用状Undistributed profit 未分配利润Unilateral/bilateral agreement 单方面/双边协议US Treasury 美国国库债券VValue added tax 增值税Vanilla bonds ???Variable equity return 浮动股本回报(率)W Withholding tax 预扣税Working capital 周转资金; 营运资金World Trade Organization 世界贸易组织XX/B (Ex-bonus) 无红利X/D (Ex-dividend) 除息、无股利X/R (Ex-rights) 除权;不带新股认股权X/W (Ex-warrants) 除证;不附认股权YYankee bonds 扬基债券(美国)Yield 收益(率)Yield curve 收益曲线Yield To Maturity 到期收益(率)YTM 到期收益(率)ZZero-sum game 零和游戏Zero coupon bonds 零券息债券国际金融市场常用术语一、金融市场术语1、floor 场内交易2、after house trading 场外交易：场内交易结束后，通过电子终端系统进行的交易3、kerb 场外交易：在交易所交易时间外的交易4、bear market 熊市5、bull market 牛市6、congested market 横向市场盘整7、liquid market 买卖易于成交的市场8、forward marke 远期市场t9、spot market 现货市场10、seller’market 卖方市场：卖方处主动地位11、bid market 卖方市场：买盘多于卖盘的市场12、buyer’s market 买方市场13、strong market 坚挺市场14、thin market 成交清淡的市场15、volatile market 多变市场16、tight market 成交活跃的市场17、weak market 疲软的市场18、two way market 双向市场二、金融市场交易术语1、quotation 报价2、asked(offer) price 卖方报价3、bid 买方叫价4、at the-money 平价5、at par 证券的面值6、closing price 收盘价7、floor price 最低价8、basis point 基点：表示利率、汇率或债券收益率变化的最小单位，通常0。
教参(金融市场)
国际金融市场International Financial Market教学参考资料教材参考中文：1、《外汇市场》产品指引中国外汇交易中心2、《外汇与货币市场导论》《金融衍生工具导论》《债券市场导论》《股票市场导论》《技术分析导论》《商品、能源和交通市场导论》（中译版）Reuters北京大学出版社3、《金融市场与经融机构》Anthony Saunders，Marcia Millon Cornett人民邮电出版社（中文翻译版）英文1、Financial Markets and InstitutionsAnthony Saunders，Marcia Millon Cornett人民邮电出版社（双语教学版）2、International Financial ManagementMichael B. Connonlly北京大学出版社（双语教学版）学术期刊中文：《经济研究》、《金融研究》、《国际金融》、《金融与经济》、《国际金融研究》、《金融理论与实践》、《中国货币市场》英文：Journal of Financial EconomicsJournal of International Money and FinanceJournal of Financial MarketJournal of FinanceJournal of Banking &FinanceJournal of Business Finance &AccountingJournal of EconomicsJournal of Money Credit and BankingAsia-pacific Journal of Financial StudiesEmerging Markets Finance and Trade经济研究和文献查阅开放用网页中文：中国人民银行中国外汇管理局中国货币中国外汇外汇交易网英文： 经济学家 商业周刊 华尔街日报 国家分析局（美国） 网络经济 商务部经济分析局（美国） 经济数据库 世界银行 国际货币基金组织 国际经济与合作组织 国际清算银行。
国际财务管理第六版中文版第五章
The indirect quote for British pound is:
£.5242 = $1
5-11
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Spot Rate Quotations
Country
USD equiv Friday
Argentina (Peso) 0.3309
Australia (Dollar) 0.7830
Brazil (Real)
0.3735
Britain (Pound) 1.9077
1 Month Forward 1.9044
3 Months Forward 1.8983
the U.S. dollar equivalent e.g. “a Japanese Yen is worth about a penny”
间接标价Indirect Quotation
the price of a U.S. dollar in the foreign currency e.g. “you get 100 yen to the dollar”
Currency per USD Friday 3.0221 1.2771 2.6774 0.5242 0.5251 0.5268 0.5290 1.2442 1.2442 1.2433 1.2412
Currency per USD The direct 0.5226 quote for
非银行交易商 nobank dealers
外汇经纪人FX brokers 俗称中介
中央银行 central banks
5-5
International Financial Management Extended Assignment Speech
International Financial Management Extended AssignmentSpeechDear professors and friends,I’m honored to be here with you today to give you this speech about International Financial Management Extended Assignment on the exchange rate exposures for the multinationals listed in Japan. The clients company is based in Japan and doing the business in both Great Britain and Japan. The aim of this presentation is to clarify the exposures the clients may face and try to give possible solutions to it. This presentation is given under the outbreak of COVID-19. let’s first take a look at the background information for the outbreak of the COVID-19.On 31 December 2019, health authorities in China reported to the World Health Organisation (WHO) a cluster of viral pneumonia cases of unknown cause in Wuhan, Hubei Province, and an investigation was launched in early January 2020. On 30 January, the WHO declared the outbreak a Public Health Emergency of International Concern (PHEIC); at that date there were 7,818 cases confirmed globally, affecting 19 countries in five WHO regions.The early cases mostly had links to the Huanan Seafood Wholesale Market and so the virus is thought to have a zoonotic origin. The virus that caused the outbreak is known as SARS‑CoV‑2, a newly discovered virus closely related to bat coronaviruses, pangolin coronaviruses, and SARS-CoV. The scientific consensus is that COVID-19 has a natural origin.The earliest known person with symptoms was later discovered to have fallen ill on 1 December 2019, and that person did not have visible connections with the later wet market cluster. Of the early cluster of cases reported that month, two-thirds were found to have a link with the market. On 13 March 2020, an unverified report from the South China Morning Post suggested a case traced back to 17 November 2019 (a 55-year-old from Hubei) may have been the first person infected.The WHO recognized the spread of COVID-19 as a pandemic on 11 March 2020. Europe, Iran, the U.S., South Korea, and Japan reported surging cases and their total numbers quickly passed China's.First of all let’s take a look at the exchange rate between British pound and Japanese Yen. As you can see in the page 5, the exchange rate is 1GBP = 133,6844 Japanese. The intraday range is 133.679 – 133.6957. also you can see the historical picture of the charts and data from pound to yen is shown in the picture. You can see there’s a dive on the day of March 19 2020.Compare the graph above, we can identify four types of the possible exchange rate risk exposure incurred by the outbreak：Type 1： Transaction Exposure, Type 2: Operating Exposure, Type 3: Translation Exposure, Type 4: Economic Exposure.And this is the sequence of the presentation, and the last is the forecast of the presentation.We will take a look at the Type 1： Transaction Exposure.A transaction exposure arises due to fluctuation in exchange rate between the time at which the contract is concluded in foreign currency and the time at which settlement is made. Transaction exposure is short term in nature, usually for a period less than one year. The credit purchase and sales, borrowing and lending denominated in foreign currencies, etc.are examples of transactions exposure. The transaction exposure basically covers three parts—Rate Risks, Credit Risk, Liquidity Risk. The Rate Risk will occur in two situations: When there is mismatch of maturity period and borrowings amount & In foreign exchange, it results in net exchange positions (long or short). The Credit Risk is a situation when the borrower is not in a position to pay. The Liquidity Risk results from the possibility of foreign exchange gains or losses when settlement takes place at a future date of foreign currency dominated contracts.Transaction exposures usually have short time horizon, and operating cash flows are affected.So, how do we manage the transaction exposure? We need to decide what extent an exposure should be explicitly hedged, Choosing the appropriate hedging vehicle, and Evaluation of the alternate hedging strategies.Second, let's take a look at Type 2: Operating Exposure.An operating exposure is the measurement of the extent to which the firm’s operating cash flows are affe cted by the exchange rate. Operating exposure is the degree to which exchange rate changes, in combination with price changes, will alter a company’s future operating cash flows, and in turn profitability. The operating exposure has two components—the Competitive Effect & Conversion Effect: The changes in exchange rate affect the competitive position of the firm in the global market. For example, the changes in the exchange rate will affect the price of the software’s of the international IT Company.Hence, in this case the cash flows of the company will be affected, the profitability will also get reduced, and thus the competitive position of the firm in the market will be effected. If the local currency gets depreciated, then operating cash flow in home cu rrency will fall. The firm’s operating exposure depends on the market structure of inputs and products, and the competitiveness of the firm in the finished goods or output market. The firm’s ability to adjust its operating exposure depends on capacity to realign its markets, product mix, and input sources. We have three types of pricing strategies: 1. Pass the cost burden to customers; 2. keep the cost burden within firm; 3. Partial Pass Through.So, How to manage Operating Exposure?We need to select the low cost production site, producing the flexible policy, diversification of the market, concentrating on R&D for cost cutting and Product Differentiation and Financial hedging.Third, let's take a look at Type 3: Translation Exposure.The accounting recording of transactions give rise to the assets or liabilities, hence whenever the parent firm tries to consolidate the position of subsidiaries in their books, the Translation exposure comes into existence. It indicates clearly that pre-existing assets and liabilities values change on account of change in foreign exchange rate. It is needed to be done with a specific intention to reflect the correct and realizable position of the parent firm with respect to financial strength because subsidiaries are part and parcel of the parent firm.This translation exposure arises due to changes in exchange rates and thus alters the values of assets, liabilities, expenses and profits or losses of the foreign subsidiaries. Financial Decisions Involved: Managing balance sheet items to minimize the net exposure & Deciding how to hedge against exposure.There are many risks, so how do we manage translation exposure?The multinationals in Japan with foreign operations can protect against translation exposure by hedging. Fortunately, the company can protect against the translation risk by purchasing foreign currency, by using currency swaps, by using currency futures, or by using a combination of these hedging techniques.Fourth, let’s take a look at the Type 4: Economic Exposure.The economic exposure refers to the change in value of firm on account of change in foreign exchange rate. The intrinsic value of the firm is equal to the sum of the present values of future cash flows discounted at an appropriate rate of return.The two cash flow exposures – operating exposures and transaction exposure –combine to equal a firm’s economic exposure. Economic exposure is measured by taking in to consideration the expected future cash flow duly adjusted by exchange rate, and then through the application of rate of return, the present value is worked out.The British economy, which relies to a large extent on tourism revenues and manufacturing, is already seeing the impact: If a firm manufactures specially for exports and finances itself on the local market, an appreciation of local currency will have a negative impact on the net cash flows, as its sales are likely to be affected to a higher degree than its expenses. If, on the other hand, the local currency depreciates, cash flows are affected exactly in the opposite way.Ongoing fears over the economic impact of the coronavirus have led to a sharp market sell-off worldwide. However, the head of the European Central Bank(ECB) has played down any imminent action as a result of the virus.“It is a fast-developing phenomenon which requires that we monitor very carefully,” Christine Lagarde told the Financial Times Thursday.How to manage the economic exposure? There are two main ways to manage it.putation of Actual Profit,b. Comments on Exchange Rate Movement.Use interest rate parity theory to make a prediction with 1GBP = x JYP:The interest rate parity theory was put forward by the British economist Keynes in the 19th century. In order to obtain higher returns, investors will shift funds from countries with lower interest rates to countries with higher interest rates. The inflow of funds makes the national currency with higher interest rates The exchange rate rises. The general form of interest rate parity: The economic meaning is that the forward premium rate of the exchange rate is equal to the difference between the currency interest rates of the two countries. If the domestic interest rate is higher than the foreign interest rate, the local currency will depreciate in the future; if the domestic interest rate is lower than the foreign interest rate, the local currency will appreciate in the forward.The GBP/JPY exchange rate saw highs of ¥134.640 to lows of ¥133.102 as markets continued to adjust to the new economic climate bought on by the coronavirus epidemic. Today's exchange rate (133.1947) is lower compared to yesterday's r ate (133.6839).Fresh volatility could be in store for the Japanese Yen on Friday with the release of March’s consumer price index report. While policymakers are unlikely to pay any particular heed to inflation data in the midst of the current Covid-19 crisis a weak reading could still put pressure on the Yen.Lastly, let’s take a look what will happen in the period of May 17-May 20 2020.As you can see the Japanese interest rate in the picture. We can conclude: The Japanese exchange rate keep stable, it has formed a trend. Therefore, Japan’s interest rate will continue to decline during the epidemic until mid-May.The GBP/JPY exchange rate saw highs of ¥134.640 to lows of ¥133.102 as markets continued to adjust to the new economic climate bought on by the coronavirus epidemic. Today's exchange rate (133.1947) is lower compared to yesterday's rate (133.6839).Fresh volatility could be in store for the Japanese Yen on Friday with the release of March’s consumer price index report. While policymakers are unlikely to pay any particular heed to inflation data in the midst of the current Covid-19 crisis a weak reading could still put pressure on the Yen.And let's take a look of the United Kingdom Interest Rate. It has formed a dropping trend.The comparison shows that Japan's interest rate is relatively stable relative to the United Kingdom. We can draw the prediction for May 17—20 from the graph: During the same time period, the rate of decline in the UK's interest rate is greater than that of Japan. But the interest rate in the UK has always remained above 0, but the interest rate in Japan has been below 0, because the interest rate of the local currency is higher than the interest rate of Japan. According to the theory of interest rate parity, arbitrageurs will transfer funds from countries with lower interest rates to countries with higher interest rates. Therefore, the depreciation of the British pound in the forward period will lower the exchange rate. This is the presentation for today, thank you!。
国际经济、银行与金融英文
国际经济、银行与金融英文International Economy, Banking, and FinanceThe international economy refers to the global system of production, trade, and exchange of goods and services between countries. It encompasses the economic interactions and interdependencies among nations, including the flow of capital, labor, technology, and knowledge across borders.Banking and finance play a crucial role in the international economy. Banks are financial institutions that facilitate the flow of funds and provide various financial services to individuals, businesses, and governments. They act as intermediaries between savers and borrowers, offering loans, managing deposits, and facilitating payments.International banks operate in multiple countries, offering services such as cross-border payments, foreign exchange, trade finance, and investment banking. They play a significant role in facilitating global trade and investment flows, providing liquidity to financial markets, and managing risks associated with international transactions.Finance, on the other hand, deals with the management of money, assets, and liabilities. It involves financial decision-making, financial markets, and institutions, investment analysis, and risk management. International finance focuses on the management of financial activities in a global context, considering factors such as exchange rate fluctuations, country-specific risks, and regulatory frameworks.Key concepts in international finance include foreign direct investment (FDI), international capital markets, currency exchange rates, and international financial institutions like the International Monetary Fund (IMF) and the World Bank. International finance also plays a crucial role in managing financial crises, ensuring stability in the global financial system, and promoting economic growth and development.In summary, the international economy, banking, and finance are interconnected domains that shape the global economic landscape. They involve cross-border transactions, financial intermediation, and decision-making processes to foster economic growth and facilitate global economic integration.。
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QUESTIONS
1. How would you define transaction exposure? How is it different from economic exposure?
9. Explain contingent exposure and discuss the advantages of using currency options to manage this type of currency exposure.
Answer: Companies may encounter a situation where they may or may not face currency exposure. In this situation, companies need options, not obligations, to buy or sell a given amount of foreign exchange they may or may not receive or have to pay. If companies either hedge using forward contracts or do not hedge at all, they may face definite currency exposure.
5. Suppose your company has purchased a put option on the German mark to manage exchange exposure associated with an account receivable denominated in that currency. In this case, your company can be said to have an ‘insurance’ policy on its receivable. Explain in what sense this is so.
10. Explain cross-hedging and discuss the factors determining its effectiveness.
Answer: Cross-hedging involves hedging a position in one asset by taking a position in another asset. The effectiveness of cross-hedging would depend on the strength and stability of the relationship between the two assets.
Answer: Transaction exposure is the sensitivity of realized domestic currency values of the firm’s contractual cash flows denominated in foreign currencies to unexpected changes in exchange rates. Unlike economic exposure, transaction exposure is well-defined and short-term.
3. Discuss and compare the costs of hedging via the forward contract and the options contract.
Answer: There is no up-front cost of hedging by forward contracts. In the case of options hedging, however, hedgers should pay the premiums for the contracts up-front. The cost of forward hedging, however, may be realized ex post when the hedger regrets his/her hedging decision.
2. Discuss and compare hedging transaction exposure using the forward contract vs. money market instruments. When do the alternative hedging approaches produce the same result?
7. Should a firm hedge? Why or why not?
Answer: In a perfect capital market, firms may not need to hedge exchange risk. But firms can add to their value by hedging if markets are imperfect. First, if management knows about the firm’s exposure better than shareholders, the firm, not its shareholders, should hedge. Second, firms may be able to hedge at a lower cost. Third, if default costs are significant, corporate hedging can be justifiable because it reduces the probability of default. Fourth, if the firm faces progressive taxes, it can reduce tax obligations by hedging which stabilizes corporate earnings.
Answer: Your company in this case knows in advance that it will receive a certain minimum dollar amount no matter what might happen to the $/€ exchange rate. Furthermore, if the German mark appreciates, your company will benefit from the rising euro.
Answer: Hedging transaction exposure by a forward contract is achieved by selling or buying foreign currency receivables or payables forward. On the other hand, money market hedge is achieved by borrowing or lending the present value of foreign currency receivables or payables, thereby creating offsetting foreign currency positions. If the interest rate parity is holding, the two hedging methods are equivalent.
8. Using an example, discuss the possible effect of hedging on a firm’s tax obligations.
Answer: One can use an example similar to the one presented in the chapter.
6. Recent surveys of corporate exchange risk management practices indicate that many U.S. firms simply do not hedge. How would you explain this result?
PROBLEMS
1. Cray Research sold a super computer to the Max Planck Institute in Germany on credit and invoiced €10 million payable in six months. Currently, the six-month forward exchange rate is $1.10/€ and the foreign exchange advisor for Cray Research predicts that the spot rate is likely to be $1.05/€ in six months. (a) What is the expected gain/loss from the forward hedging? (b) If you were the financial manager of Cray Research, would you recommend hedging this euro receivable? Why or why not? (c) Suppose the foreign exchange advisor predicts that the future spot rate will be the same as the forward exchange rate quoted today. Would you recommend hedging in this case? Why or why not?