NotesonChapter1
Chapter 1
This is the overview chapter of the textbook. Two of the points in this chapter:
1. Issues of how to managing the MNC (see the definition MNC)
a) The agency problem of MNC is more serious than the pure domestic firm and
therefore
Chapter 20: Short-Term Financing
71
Chapter 20
Short-Term Financing
1. MNCs may be able to lock in a lower cost from financing in a low interest rate foreign currency if
they:
A) have future cash inflows in that foreign currency.
B) have future cash outfl
2
International Financial Management
Chapter 11
Managing Transaction Exposure
1. Assume zero transaction costs. If the 90-day forward rate of the euro is an accurate estimate of the
spot rate 90 days from now, then the real cost of hedging payables will b
Chapter 18: Long-Term Financing
51
Chapter 18
Long-Term Financing
1. Ideally, a firm desires to denominate bonds in a currency that:
A) exhibits a low interest rate and is expected to appreciate.
B) exhibits a low interest rate and is expected to deprecia
254
International Financial Management
Chapter 13
Direct Foreign Investment
1. Based on the text, it should be obvious that markets are_ in reality, and consequently,
monopolistic advantages _ be exploited.
A) perfect; may possibly
B) perfect; cannot
C) i
60 International Financial Management
Chapter 19
Financing International Trade
1. Which of the following is a reason why commercial banks can facilitate international trade?
A) The exporter may not wish to accept credit risk of the importer.
B) The govern
Chapter 10Measuring Exposure to Exchange Rate Fluctuations
1. Translation exposure reflects:
a. the exposure of a firm's international contractual transactions to exchange rate fluctuations.
b. the exposure of a firm's local currency value to transactions
Chapter 6Government Influence on Exchange Rates
1. To force the value of the pound to appreciate against the dollar, the Federal
Reserve should:
a.
sell dollars for pounds in the
foreign exchange market and the
European Central Bank (ECB)
should sell doll
1. $2,000,000/$0.3249/NZ $ = NZ $6,155,740.23 *$0.3325/NZ$=$2,046,783.63
$2,046,783.63-$2,000,000=$46,783.63
We should buy from Bank Y and sell to Bank X and make profit of $46,783.63.
2. $100,000/$1.47/ *(1+1.3%)= 68,911.56 * $1.49/=$102,678.23
The retur
FNCE 6290 Quantitative Methods for Finance
Yufeng Han
Lecture 1
Introduction
1. A Motivational Example Why Is It Important to Use Statistics and
Econometrics in Finance?
Lets look at the price and return of the S&P 500 composite index over its whole
histo
FNCE 6290 Quantitative Methods for Finance
Yufeng Han
Lecture 4
Statistical Inference - Estimation and Testing
1. From Population to Sample
A distribution can be completely determined by its moments (such as mean and
variance). However, these moments are
FNCE 6290 Quantitative Methods For Finance
Yufeng Han
Lecture 4
Statistical Inference - Estimation and Testing
Exercise 1.
Use Stata/JMP to compute the sample mean, variance, skewness and kurtosis of the
return on Ford stock, and the covariance & correlat
FNCE 6290 Quantitative Methods for Finance
Yufeng Han
Lecture 4
Statistical Estimation and Testing
HOMEWORK #4
Problem I:
1. If we collect 252 observations from the monthly returns on IYY described in
Lecture 3 Problem 2, what is the sampling distribution
1.
There is one card that is a king of spade, the probability is 1/52
There are 13 cards in spade out of 52 cards, the probability is 13/52 = 1/4
There are 12 cards for a jack, a queen, or a king out of 52 cards,
the probability is 12/52 = 3/13
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Critical Thinking
Critical Thinking
How have problems changed?
Why do we need systems thinking in this
day and age?
Critical Thinking
HOW do we transfer systems thinking
skills?
Educational process
Thinking paradigm
Learning
3 Rules of Problem Solving
From: Puzzle-based
Learning by
Michalewicz &
Michalewicz
Rule #1: Be sure you
understand the problem (root
cause) and all the basic terms
and expressions used to
define it
3 Rules of Problem Solving
The Problem: What are you aft