NATIONAL OPEN UNIVERSITY OF NIGERIA

UNIVERSITY VILLAGE, PLOT 91, CASDASTRAL ZONE, NNAMDI AZIKIWE EXPRESS WAY, JABI, ABUJA.
FACULTY OF MANAGEMENT SCIENCES
APRIL/MAY 2019 EXAMINATION

COURSE TITLE: INTERNATIONAL FINANCE

TIME ALLOWED: 2^1/2HRS

INSTRUCTIONS:

1. Attempt Question One (1) and any other three (3) questions

2. Question 1 carries 25 marks, while the other questions carry 15 marks each.

Question 1

i) Briefly explain the term ‘International finance’, and discuss its three basic usefulness.              (8 marks)

ii) Discuss five (5) causes of balance of payments deficit. (10 marks)

iii) One way to restore International Equilibrium is through price mechanism. How will this be possible? Justify your answer. (7 marks)

Question 2

i) Identify and explain four (4) reasons for undertaking international trade. (10 marks)

ii) Discuss the common challenges of international trade. (5 marks)

Question 3

i) Explain the problems of devaluation. (10 marks)

ii) Highlight the objectives of OPEC. (5 marks)

Question 4

i) Discuss the three (3) types of foreign exchange exposure (Risk). (9 marks)

ii) Discuss the five (5) major theories of exchange-rate determination. (6 marks)

Question 5

i) Identify six (6) forms of capital and briefly explain three of them. (9 marks)

ii) Discuss six (6) types of international financial instruments that are used to mobilize foreign capital. (6 marks)

Question 6

i) Briefly discuss the importance of portfolio benchmarks. (6 marks)

iii) Discuss the three (3) approaches to analysis of devaluation theory. (9 marks)