Download GTU (Gujarat Technological University) MBA 2019 Winter 3rd Sem 1539321 Global Financial Management Previous Question Paper
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA (IB) ? SEMESTER III ? EXAMINATION ? WINTER 2019
Subject Code: 1539321 Date: 02/12/2019
Subject Name: Global Financial Management
Time: 10.30a.m to 1.30 p.m. Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q.1 Explain the terms.
(a) Euro Bank
(b) LIBOR
(c) ECB
(d) Yankee Bonds
(e) Syndicated Credits
(f) GDR
(g) Netting
14
Q.2 (a) ?Growth of MNCs and International Trade are responsible for growing
importance of Global Financial Exposure for a Firm.? Discuss
Complexities of International Financial Management compared to
Domestic Financial Management.
07
(b) Discuss and explain in detail most widely known and accepted
benchmark in Global Financial Markets ?LIBID and LIBOR?.
07
OR
(b) Banker?s Acceptance is one of the widely used Financial Instrument in
Global Money Market. Explain the working mechanism with suitable
Example.
07
Q.3 (a) Evaluate various Methods of raising Funds by an MNC. 07
(b) Explain risk handling techniques in investment decision. 07
OR
Q.3 (a) Discuss Bottlenecks in FDI Flows to India.
07
(b) An MNC from India is considering the following Investment Proposals
in different countries after thorough evaluation from parent perspective
below result is received in terms of NPV.
(Amt in Cr.)
Project Indonesia Kenya Estonia
A 450 212 152.3
B 63.8 52.45 78.00
C 21.25 32.6 19.8
D 789.62 485.32 658.86
Tax rate 35 % 38 % 40 %
07
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Page 1 of 2
Seat No.: ________ Enrolment No.___________
GUJARAT TECHNOLOGICAL UNIVERSITY
MBA (IB) ? SEMESTER III ? EXAMINATION ? WINTER 2019
Subject Code: 1539321 Date: 02/12/2019
Subject Name: Global Financial Management
Time: 10.30a.m to 1.30 p.m. Total Marks: 70
Instructions:
1. Attempt all questions.
2. Make suitable assumptions wherever necessary.
3. Figures to the right indicate full marks.
Q.1 Explain the terms.
(a) Euro Bank
(b) LIBOR
(c) ECB
(d) Yankee Bonds
(e) Syndicated Credits
(f) GDR
(g) Netting
14
Q.2 (a) ?Growth of MNCs and International Trade are responsible for growing
importance of Global Financial Exposure for a Firm.? Discuss
Complexities of International Financial Management compared to
Domestic Financial Management.
07
(b) Discuss and explain in detail most widely known and accepted
benchmark in Global Financial Markets ?LIBID and LIBOR?.
07
OR
(b) Banker?s Acceptance is one of the widely used Financial Instrument in
Global Money Market. Explain the working mechanism with suitable
Example.
07
Q.3 (a) Evaluate various Methods of raising Funds by an MNC. 07
(b) Explain risk handling techniques in investment decision. 07
OR
Q.3 (a) Discuss Bottlenecks in FDI Flows to India.
07
(b) An MNC from India is considering the following Investment Proposals
in different countries after thorough evaluation from parent perspective
below result is received in terms of NPV.
(Amt in Cr.)
Project Indonesia Kenya Estonia
A 450 212 152.3
B 63.8 52.45 78.00
C 21.25 32.6 19.8
D 789.62 485.32 658.86
Tax rate 35 % 38 % 40 %
07
Page 2 of 2
The company is certain to execute the all projects with required
investment, decision is pending regarding country selection.
As a consultant based on this information only you need to suggest
which project in which country should be opted? Why?
Q.4 (a) List out and explain in detail critical dimensions of International
Financial Decision Making.
07
(b) Explain Difference between centralized and decentralize Cash
Management System. Also list out advantages and disadvantages of
Centralized Cash Management System.
07
OR
Q.4 (a) Write a note on Project Finance as one of the major market segment to
raise funds in global market.
07
(b) Discuss Netting Exposure with suitable example as an important
advantage for Centralized Cash Management.
07
Q.5
CASE STUDY:
Hanson and Sons Inc. a U.S. based MNC is considering a capital
project in India requiring an outlay of 15 million Rs. It is expected to
generate 3.75 million Rs. Cash inflow for 6 years. The opportunity cost
of capital is 18%. The firm can raise a term loan of 10 million Rs for the
project. The term loan will carry an interest rate of 16 percent and
would be repayable in 5 equal installments, the first installment falling
due at the end of the second year. The balance amount required for the
project can be raised by issuing equity. The issue cost is expected to be
8 percent. The Tax rate for the company is 50 %. Assume spot rate at
USD/INR 50.
(a) Based on above mentioned information from Project perspective
calculate
a. NPV
b. APV
c. PV of tax Shield on debt Finance.
14
OR
Q.5 (a) Based on above mentioned information from Parent perspective
calculate
a. NPV
b. APV
c. PV of tax Shield on debt Finance.
14
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This post was last modified on 19 February 2020