COURSE UNIT TITLE

: INTERNATIONAL FINANCIAL MANAGEMENT

DEGREE PROGRAMMES

Description of Individual Course Units

Course Unit Code Course Unit Title Type Of Course D U L ECTS
MSF 5114 INTERNATIONAL FINANCIAL MANAGEMENT ELECTIVE 3 0 0 6

Offered By

Accounting and Finance (English)

Level of Course Unit

Second Cycle Programmes (Master's Degree)

Course Coordinator

PROFESSOR DOCTOR PINAR EVRIM MANDACI

Offered to

Accounting and Finance (English)

Course Objective

The objective of this course is to provide the students with information about the history of the international monetary system and the problems, techniques and policies of financial decision making in an international enterprises, to analyze foreign exchange markets, parity conditions and balance of payments, hedging against foreign exchange risk and financial derivatives.

Learning Outcomes of the Course Unit

1   Describe the history of international monetary system pointing out the Gold Standard, Bretton-Woods and hybrid systems, and European Monetary System
2   Explain the social, cultural, political, and economic factors that affect the general level of risk in a country pointing out the origins of and proposed mechanisms in order to deal with the various currency crises
3   Identify the factors affecting exchange rates, pointing out different exchange rate systems such as free float, managed float and fixed rate systems
4   Identify the links between domestic economic behavior and the international flows of goods and capital in order to describe how these links are reflected in the various balance of payments accounts
5   Assess currency and interest rate arbitrage opportunities in order to calculate the profits associated with these arbitrage opportunities
6   Explain Purchasing Power Parity, Fisher Effect, International Fisher Effect, Interest Rate Parity, and Forward Rates pointing out the theoretical relationships among spot exchange rates, forward exchange rates, inflation rates, and interest rates
7   Explain how currency futures and options contracts and swaps can be used in order to manage currency risk
8   Identify the basic hedging strategy and techniques used by firms to manage their transaction, and economic exposures.
9   Describe the marketing, production, and financial strategies that are appropriate for coping with the economic consequences of their ability to rapidly respond to currency changes.

Mode of Delivery

Face -to- Face

Prerequisites and Co-requisites

None

Recomended Optional Programme Components

None

Course Contents

Week Subject Description
1 Introduction Multinational Enterprise and Multinational Financial Management
2 The Determination of Exchange Rates
3 The International Monetary System and Financial Crises
4 The Balance of Payments and International Economic Linkages
5 Country Risk Analysis
6 The Foreign Exchange Market
7 Parity Conditions in International Finance and Currency Forecasting
8 Review
9 Currency Futures and Options Markets
10 Measuring and Managing Transaction Exposure
11 Measuring and Managing Economic Exposure
12 International Financing and International Financial Markets
13 Special Financing and Interest Risk Management Vehicles
14 Review

Recomended or Required Reading

1. Shapiro, A., (2009). Multinational Financial Management, 9th Edition, John Wiley & Sons.
2. Eun, C., Resnick, B. (2008). International Financial Management, 5th Edition, McGraw-Hill.

Planned Learning Activities and Teaching Methods

Lecture, discussions, case studies, problem solving

Assessment Methods

SORTING NUMBER SHORT CODE LONG CODE FORMULA
1 MTE MIDTERM EXAM
2 FCG FINAL COURSE GRADE
3 FCGR FINAL COURSE GRADE MTE * 0.40 + FCG* 0.60
4 RST RESIT
5 FCGR FINAL COURSE GRADE (RESIT) MTE * 0.40 + RST* 0.60


Further Notes About Assessment Methods

None

Assessment Criteria

1. The students will describe the history of international monetary system.
2. The students will distinguish between a free float, a managed float, a target zone arrangement, and a fixed-rate system of exchange rate system of exchange rate determination.
3. The students will explain the international financial environment (e.g. the origins and effects of the financial crises.)
4. The students will structure the organization of foreign exchange markets
5. The students will calculate the profits associated with currency arbitrage opportunities.
6. The students will illustrate the links between domestic economic behavior and the international flows of goods and capital
7. The students will explain Purchasing Power Parity, Fisher Effect, International Fisher Effect, Interest Rate Parity, and Forward Rates
8. The students will explain how the financial derivative instruments can be used to hedge currency risks
9. The students will assess the economic soundness of the various corporate hedging objectives in transaction and economic exposures.

Language of Instruction

English

Course Policies and Rules

1. Plagiarism of any type will result in disciplinary action.
2. Attending at least 70 percent of lectures is mandatory.
3. All assignments should be submitted on time. Otherwise will not be accepted.

Contact Details for the Lecturer(s)

tulay.yucel@deu.edu.tr

Office Hours

To be announced.

Work Placement(s)

None

Workload Calculation

Activities Number Time (hours) Total Work Load (hours)
Lectures 14 3 42
Preparations before/after weekly lectures 14 4 56
Preparation for midterm exam 1 20 20
Preparation for final exam 1 20 20
Final 1 2 2
Midterm 1 2 2
TOTAL WORKLOAD (hours) 142

Contribution of Learning Outcomes to Programme Outcomes

PO/LOPO.1PO.2PO.3PO.4PO.5PO.6PO.7
LO.14345554
LO.24345554
LO.34345554
LO.44345554
LO.54345554
LO.64345554
LO.74345554
LO.84345554
LO.94345554

CONTACT INFORMATION
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