CHRIST UNIVERISTY

Department of Management Studies Bachelor of Business Management (BBM) V - Semester (June 2012 to October 2012) Hosur Road, Bangalore - 29

COURSE PLAN
Subject:Global Business Finance Subject Code: BBM 542 Faculty Name: Mahesh Haridas, Jayant Kalgatagi & Ravikumar Email ID: Mahesh.haridas@christuniversity.in

COURSE OBJECTIVES: 1. To know the players in the foreign market and the strengthening measures implemented due to liberalized policies. 2. To acquire knowledge on the functioning of global business and its financial implications. 3. To analyze the foreign exchange activities, hedging of foreign exchange exposures and other related aspects of risk coverage will be taken into consideration in global business. 4. To explore sound theoretical knowledge of foreign exchange transactions with practical and procedural aspects of banks and other institutions connected with foreign exchange. GLOBAL BUSINESS FINANCE LECTURE SCHEDULE Unit: I International Financial Markets 05 Hrs Introduction, Motives for investing & borrowing in Foreign markets, International business methods, How financial markets affect an MNCs value. Unit: II Changing Global Financial Environment 10 Hrs Evolution of the International Monetary system, Bimetallism, Classical Gold standard, Interwar period, Bretton woods system, Flexible Exchange rate regime. The current exchange rate agreements, European monetary system, Mexican peso crisis, Fixed Versus Flexible Exchange Rate regime Unit: III Balance of Payments 06 Hrs Concept of Balance of payments, Concept and Principles behind compilation of BoP account, Components of BoP and factors affecting them, Importance and Limitations of BoP statistics, Relationship of BoP with other Economic Variables

Unit: IV Foreign Exchange Markets 10 Hrs The structure of the FOREX markets, Functions of Foreign exchange markets, The foreign exchange rates, Arbitrage, The spot market, Cross rates of exchange, Bid-ask spreads, The forward market, The regulations, Derivatives, Foreign currency futures, foreign currency options. Unit: V Exchange Rate Determination 12 Hrs Interest rate parity, Purchasing power parity, The Fisher effects, Forecasting Exchange Rates Efficient market approach, Fundamental approach, Technical approach, Performance of forecasters Unit: VI Euro Currency Markets 09 Hrs Introduction to Euro markets, Euro currency instruments, Determinants of Euro currency rates, Growth of Euro dollar markets, International bond markets, External commercial borrowings, Euro debts, foreign currency convertible bonds, Advantages of Euro bonds, Performance of Indian Euro issues Unit: VII Managing Foreign Exchange Exposure 04 Hrs Management of foreign exchange risk, Management of translation Exposure, Management of transaction Exposure, Management of Economic Exposure GLOBAL BUSINESS FINANCE SESSION PLAN Topics Session Introduction to Global Business Finance 1 Motives for Investing & Borrowing in Foreign 1 Markets International Business Methods 1 Impact of Financial Markets on MNCs Value 2 Evolution of The IMF & Bimetallism 2 Classical Gold Standard, Interwar Period 2 Bretton Woods System 2 Flexible Exchange Rate Regime & Current 2 Exchange Rate Agreements European Monetary System, Mexican Peso Crisis 1 Fixed Vs Flexible Exchange Rate Regime 1 Concept of Balance of Payments 1 Concept and Principles behind compilation of 1 BoP Account Components of BoP & Factors Affecting BOP 2 Importance and Limitations of BoP Statistics 1 Relationship of BoP with other Economic 1 Variables Structure of the FOREX markets 1 Functions of Foreign Exchange Markets 1 FOREX Rates, Arbitrage & Spot Market 2

Module/ Hrs I - 5 Hrs (04/06/12 to 12/06/12)

Methodology Lectures, Presentations, Assignment

II - 10 Hrs (12/06/12 to 28/06/12)

Lectures, Presentation & Discussion, Case Study

III - 6 Hrs (29/06/12 to 12/07/12)

Lectures, Presentation & Case Study

IV - 10 Hrs (13/07/12to (03/08/12)

V - 12 Hrs (15/08/12 to 01/09/12)

VI - 10 Hrs (03/09/12 to 22/09/12)

VII - 4 Hrs 24/09/12to 29/09/12)

Cross Rates of Exchange Bid-ask Spreads, Cross Rates of Exchange Forward Market Regulation, Derivatives Foreign Currency Futures, Foreign Currency Options Interest Rate Parity Purchasing Power Parity The Fisher Effects Forecasting Exchange Rates Efficient Market Approach Fundamental Approach Technical Approach Performance of Forecasters Introduction to Euro Markets Euro Currency Instruments Determinants of Euro Currency Rates Growth of Euro Dollar Markets International Bond Markets External Commercial Borrowings, Euro Debts Foreign Currency Convertible Bonds Advantages of Euro Bonds Performance of Indian Euro issues Management of Foreign Exchange Risk Management of Translation Exposure Management of Transaction Exposure Management of Economic Exposure TOTAL

1 1 2 2 1 1 1 1 2 2 2 1 1 1 1 2 1 1 1 1 1 1 1 1 1 56

Lectures, Presentation, Discussion, Case Study & Article Writing

Lectures, Presentation, Quizzes

Lectures, Presentation, Discussion, Extempore

Lectures, Presentation, Discussion

Details CIA-I CIA - II CIA III Attendance

ASSESSMENT AND EVALUATION Particulars Mid semester Exam Written Assignment Topics mentioned below Presenting their CIA - II topic and Evaluation will be done through Peer Group As per Slab (Maximum)

Submission Date 4th August 2012 15th July 2012 st 5 September 2012

CIA II ASSIGNMENT TOPIC The students are advised to identify the global business financial activities for each and every country with the country GDP, Inflation, Export, Import, Forex rates, Stock market development and their key macro economic variables for each and every country throughout global level. Finally, students are requested to submit a comparative report of Global Business Finance and its impact and usefulness towards the growth rate of the country. Article Review and review of research report.

CIA III ASSIGNMENT TOPIC In CIA III, Students are divided into different groups for making micro presentation on research article or case study in front of the class. As per the class facilitator instruction, the students are assessed through micro presentation about their research work or case study followed by question hour. The presentation will be marked by your class students and the faculty. Presentation on Video cases and situation in International Financial Markets.

GUIDE LINES FOR OTHER ASSIGNMENT SUBMISSIONS (ON LINE) a) Please use the following specifications for your assignment layout: Font: Times New Roman Font Size 12 Spacing 1.5 spacing Margins: Left, Right, Top and Bottom 1'" Header to include MMA Assignment topic (contained within top margin) Footer to include Student Name & Number: Page no's formatted to include total b) Please include a cover-sheet setting out: Your Name and Register number Assignment due date Word count The title of the assignment. c) Your assignment should be thoroughly checked for typing, spelling and grammatical errors. d) You may consider having a colleague proof read your assignment before you submit it. e) Make sure you acknowledge, all sources used to write your assignment eg., Journals, books, Articles etc. f) Provide a list of references; at the end of your assignment. g) Use a range of scholarly materials. e.g. Peer-reviewed articles from the scholarly databases, textbooks and material from the Internet. Material from the Internet often, however, does not have the same peer review mechanisms in place so you must be wary what you use as literature to support your reviews. GENERAL ASSESSMENT CRITERIA Assessment of the submitted work will be evaluated on understanding the concepts learned, research done and the presentation. The written assignments must satisfy the following; they are 1. Understanding of the relevant topic. 2. Ability to apply the concept from the text appropriately to the question or topic of discussion.

3. Evidence of critical thinking, valid arguments, appropriate evidence, to articulate and defend a position on issues. 4. On time submission - Late submission would welcome a penalty of 10% per day for every day such work is overdue including Weekends and Public Holidays. 5. Your opinion on an issue is not what matters but how you relate it to the appropriate portions of the text, supported with other evidences (collected from library or other researches from authentic sources) is what fetches marks. Recommended Books: 1. V. A. Avadhani on International Financial Management, Himalaya Publishing House. New Delhi. 2. Allan C. Shapiro on Multinational Financial Management, Prentice Hall, New Delhi. 3. Shashi K. Gupta, Nisha Aggrrwal and Neetu Gupta on Financial Institutions & Markets, Kalyani Publishers, New Delhi. 4. Madhu Vij on International Financial Management, Excel Book House, New Delhi. 5. Ian H. Giddy on Global Financial Markets, A.I.T.B.S Publishers & Distributors, New Delhi. 6. Prakash G. Apte on International Financial Management, McGraw-Hill Publication, New Delhi. 7. Francis Cherunilam on International Economics, McGraw -Hill Publication, New Delhi. 8. C. Jeevanandam on Foreign Exchange Practice, Concepts & Control, Sultan Chand Sons Company Limited, New Delhi. Recommended Text: 1. Jeff Madura on International Corporate Finance, 10th Edition, South Western Cengage Learning International Edition. 2. Allan C. Shapiro on Multinational Financial Management, Prentice Hall, New Delhi. 3. Shashi K. Gupta, Nisha Aggrrwal and Neetu Gupta on Financial Institutions & Markets, Kalyani Publishers, New Delhi. 4. Prakash G. Apte on International Financial Management, McGraw-Hill Publication, New Delhi.