FIN 525 International Financial Management
1. The Big Mac Index
Some people read tea leaves to predict the future, The Economist magazine prefers
hamburgers. The magazine started the Big Mac Index in 1986 as a light-hearted guide
January 23, 2017
Highly volatile: would have high beta
What moves Bitcoin?
-Geopolitcal climate in China
-No country claims currency- but accepted by two parties
Threatening to China b/c you transfer Bitcoin to another countries currenc
Chapter 7: International Arbitrage and Interest Rate Parity
International Arbitrage and Interest Rate Parity
1. Due to _, market forces should realign the relationship between the interest rate
differential of two currencies and the forward
International Financial Management
Forecasting Exchange Rates
1. Which of the following forecasting techniques would best represent the use of todays forward
exchange rate to forecast the future exchange rate?
A) fundamental forecasting.
Chapter 8: Relationships Among Inflation, Interest Rates, and Exchange Rates
Relationships Among Inflation,
Interest Rates, and Exchange Rates
1. Assume a two-country world: Country A and Country B. Which of the following is correct about
1. Summary of Current Account in the year 2011
a. Exporting merchandise = receiving money (positive)
b. Importing merchandise = losing money (negative)
c. Foreign aid = outflow
2. Capital Account
a. Originally included in financial accou
NAFTA 23 years old, pre internet, pre cell phones. Needs to be adjusted for changing times, just how?
Balance of Payments
Between countries according to economists we can create balance sheets.
If we are exporting goods and service
Chapter 4 Notes
Measuring exchange rate movements
Exchange rate movements affects a Multinational corporations value because they can affect the
amount of cash inflows received from exporting or from a subsidiary and the amount of cash outflows
The Impossible Trinity - because the forces of economics do not allow a country to simultaneously achieve all three goals: monetary independence, exchange rate stability, and full
1. Exchange rate STABILITY. a managed or fixed excha
is definitely another reason for Americans and
Cubans to get closer and touch with hands one of the first benefit of the