TYBMS Sem 6 Elective Finance Question Paper 2026 - Mumbai University | munotes

Questions asked in this paper

1. Q1 All questions are compulsory subject to internal choice
2. Q2 Figures to the right indicate full marks
3. Q3 Use of simple calculator is allowed
   • (a) Multiple Choice Questions(any 8): 8
   • (1) A is a regime where the currency price is set by the forex market based on supply and demand compared with other currencies
   • (a) Gold Standard
   • (2) In BOP, under account exports and imports of goods, services and unilateral transfers are recorded
   • (a) Current Account
   • (b) Capital Account
   • (c) Errors & Omissions
   • (3) comprises of all those institutions and individuals who buy and sell foreign exchange which may be defined as foreign money or any liquid claim on foreign money
   • (4) When a firm lists its equity shares on one or more foreign stock exchange in addition to its domestic exchange, it is called as
   • (a) Cross Listing of Shares
   • (c) Yankee Offering
   • (5) is a soft, liberal & simplified law that aims at boosting foreign trade and investment more in tune with Country’s new economic environment of globalization of
   • (c) SEBI Act
   • (6) The risk of loss in purchasing power because the value of investments does not keep up with inflation is called as
   • (a) Concentration Risk
   • (b) Inflation Risk
   • (c) Liquidity Risk
   • (d) Transaction Risk
   • (7) is a Way of trading stocks on the U.S. exchange
   • (8) is currency held on deposit outside its home market
   • (c) Euro credit
   • (9) is the process of assessing, in a structured way, the case for proceeding with a project or proposal, or the project’s viability
   • (a) Project Appraisal
   • (b) Project Finance
   • (c) Project Measurement
   • (d) Project Performance
   • (10) According to technique of FOREX risk management, a company dealing in international transactions must make all its payments in its domestic currency and must have the policy of accepting only domestic currency from the debtors
   • (a) Matching
   • (b) Leading and Lagging
   • (c) Hedging
   • (d) Invoice in Home Currency State whether the following statements are True or False (any 7): (07)
4. Q1 The Balance of Payment identity is CA+FA+RA = 0
5. Q2 Gold standard has proved to be a “fair weather friend”
6. Q3 Nostro account points at “Our account with you”
7. Q4 Exporters sell foreign currencies for domestic currencies
8. Q5 If AFM is positive, it represents premium on base currency
9. Q6 The call option is the right to sell an asset at a fixed date and price
10. Q7 Incase of FPI, entry and exit are difficult
11. Q8 Net Present Value = Present Value of Cash Inflow + Present Value of Cash
12. Q9 India is a tax haven country
13. Q10 Dumping means selling goods at high price in international markets What is International Finance? Describe the emerging challenges in international (08)
    • (B) What are the components of Balance of Payment? 7
    • (P) The following quote is given in Mumbai: 1USD = INR 81.2125-82.2325 e Is it a Direct Quote in India? e Find Mid Rate, Spread and Spread% e Calculate the inverse quote 7
    • (Q) if triangular arbitrage exists and calculate the same: Note: Compare CAD CHF quotes for calculating Arbitrage & Explain global money market instruments. (08) 8
    • (B) What is Euro bank? What are its competitive advantages? 7
    • (P) Consider the following information: Calculate 1 Month Forward, 3 Month Forward and 6 Month Forward USD-SGD Rate Calculate 60 Days AFM and interpret the results 8
14. Q4 (A) What is FDI? How is it different from FPI? 8 marks
    • (B) Describe the essential qualities of a FOREX manager. 7
    • (P) Given: 7
    • (Q) From the following data, find the best alternative for borrowing INR 20 Million for a temporary period of 6 Months. Exchange rates are against INR 8
15. Q5 (A) What are tax havens? Explain their benefits. 8 marks
    • (B) A&N Ltd. is considering to invest in a project requiring a capital outlay of Rs. 6,00,000. Forecast for annual income after tax is as follows: Evaluate the project on the basis of Net Present Value and advise whether A&N Ltd should invest in the project or not? 7
16. Q5 Write Short Notes on (any three) 15 marks
    • (P) 1) Gold Standard
    • ii) Functions of FOREX market
    • iii) ADRs
    • iv) Role of FEDAI
    • v) Types of FOREX Risks

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