(A Division of FGS Classes)Sub.: - International FinanceMarks: - 75Dt.: -1st Prelim ExamTime: 2 HRNote:1) All questions are compulsory.2) Use of Only Simple Calculator is permitted.3) Figures to the right indicate maximum marks.

(SECTION I)Q1 Explain any five of the following concepts: - (15)a) Nostro and Vostro Accountsb) Vehicle Currencyc) Triffins Paradoxd) Managed Floate) Card and Ready Ratesf) Petrodollarsg) Authorized Money Changersh) Call and Put Options

Q2A (5)Spot GBP / SEK 3 Months ForwardSEK Interest Rate:GBP Interest Rate:9.91459.97753.60% p.a.1.20% p.a.

Calculate covered arbitrage

Q2B Analyse the following report and answer the questions there under: (10)FGS Company informed the NSE in Oct. 2011 that they would be issuing FCCBs of US $ 10 each to International investors aggregating USD 200 million providing for conversion into 1 GDR of the Co at the end of three years or refund of the principal amount of US $ 10 at the option of the investors. The issue had a Green Shoe Option of 15%. The issue was oversubscribed 3 times. The Co therefore utilized the Green Shoe Option to full extent. In Oct 2014, at maturity, the rate for 1 US $ was INR 62 and the stock price was INR 868.i. Define FCCBsii. Define Green Shoe Option. In which situation can it be exercised?iii. In view of exchange rate & stock price at maturity, will the investors want conversion into GDRs or would they want the principal? iv. If all investors want conversion into shares / GDRs what would be the equity dilution? Q3 Solve the following:a) A Bank in Mumbai quotes USD / INR 60.6735 25. Is this a direct or indirect quote in India? Calculate Spread, Mean Rate, and Spread Percentage.(5)b) Bank A quotes:EUR / USD 1.3530 40 Bank B quotes: USD / CHF 0.9303 13. What should be the delivered CHF / EUR quotation? If Bank C quotes: CHF / EUR 0.7950 60 what would be the possible gain on capital of EUR 2 million.(5)c) Spot USD / SGD 1.2690 10SGD Interest Rates: 0.40 0.70 % p.a.USD Interest Rates: 1.25 1.50% p.a. Calculate 6 months forward USD / SGD quotation. Derive the 6 months forward swap points.ORd) Enumerate the features of the Bretton Woods System.(8)e) Discuss the factors which affect exchange rates.(7) Q4A Define Euro-Currency Markets and enumerate / discuss their characteristics in detail.(8)B Distinguish between Foreign Currencies Forward Contracts & Futures Contracts.(7)ORC Define Currency Convertibility and trace its implementation in the context of INR.(8)D Distinguish between FDI and FPI.(7)Q5Write Short Notes any three of the following: (15)a) Balance of Paymentsb) Covered Interest Arbitragec) LIBORd) FEDAIFGS/ TYBMS/ INTERNATIONAL FINANCEPage 1