FOREIGN EXCHANGE MANAGEMENT

Paper Code:

MFM424

Credits:

Contact Hours:

60.00

Max. Marks:

100.00

Objective:

Students will be able to gain understanding on the intricacies of the foreign exchange market, exchange rate determinants, theories, exchange controls, balance of payments, and international payment methods, including letters of credit and bills of exchange.

Course Outcomes:

Course

Learning outcome

(at course level)

Learning and teaching strategies

Assessment Strategies

Course Code

Course

title

24MFM 424

Foreign Exchange Management

(Theory)

CO701: Apply the proper knowledge about Foreign exchange in real scenario

CO702: Analyse the operations of foreign exchange market.

CO703: Interpret the theories and determination of foreign exchange rates.

CO704: Evaluate general factors of exchange rate fluctuations.

CO705: Analyze the concept of Balance of Payment.

CO706: Contribute effectively in course-specific interaction

Approach in teaching:

Interactive Lectures, Group Discussion, Tutorials, Case Study

Learning activities for the students:

Self-learning assignments,

presentations

.Class test, Semester end examinations, Quiz, Assignments, Presentation

12.00

Unit I:

Foreign Exchange marke

Meaning, Features, functions, participants in foreign exchange market methods of affecting international payments, dealings on the Foreign Exchange Market- Spot and Forward Exchanges, Forward Exchange Rates, Futures, Options, Swap Operation.

12.00

Unit II:

Foreign Exchange Rate & Theories of Foreign Exchange Rate

Concept, factors determining spot exchange rates, fluctuations in the rate of exchange, Types of Exchange Rate: Fixed & Flexible exchange rate.

Theories of exchange Rate: Demand and supply theory of exchange rate, PPP Theory, Balance of Payment theory.

12.00

Unit III:

Exchange Control

Meaning, features, Objectives, Methods-Unilateral methods & Bilateral methods, Merits and demerits, Exchange Control in India, Exchange Control Authority- Authorized dealers, Foreign Exchange Dealers Association of India(FEDAI),Foreign Exchange Reserves in India.

12.00

Unit IV:

Balance of Payment

Concept, Structure, Components of Balance of Payment, Difference between Balance of trade and Balance of Payment, Equilibrium in BOP, Disequilibrium in BOP, Types of Disequilibrium, Measures to correct disequilibrium.

12.00

Unit V:

Methods of Payment

Letter of Credit–meaning, mechanism, evaluation of LOC, Types of LOC. Bills of Exchange-meaning, Types of bills, noting and protest, stamp duty.
Introduction to International Monetary fund (IMF)

*Case studies related to entire topics are to be taught

Essential Readings:

C. Jeevanandam ,“Foreign exchange and risk management”,Sultan Chand
FrancisCherunilam,”International trade and export management“,Himalaya publication.
OP Agarwal, “Foreign trade and foreign exchange” Himalaya Publication House, Mumbai
Avadhani,V.A,”International Finance, Theory and Practice” Himalya Publishing company,NewDelhi.
S.K.Mathur,”InternationalTradeandFinance”ShivamBookHouse,Jaipur

References:

Suggested Readings:

· Cherunilam Francis,” International Business”,Tata Mc Graw-Hill Publishing Co.Limited New Delhi.

· WoodandJByrne: International Businessfinance, Macmillan ,New York.

· Walter, Ingo:HandbookofInternationalBusiness ,John Wileyandsons, New York.

· Mithani D.M., ”Introduction to International Economics” Himalaya publishing House ,Mumbai.

E Resources:

· https://www.expresslibrary.mheducation.com/bookshelf

· Elibrary.in.pearson.com

· https://www.yourarticlelibrary.com/international-business

· https://www.investopedia.com/terms/m/internationalmarkets.asp

· https://www.slideshare.net/