International Finance

AY2020/2021 Semester 1

Many companies engage in cross-border business and they face important financial questions beyond those found in a purely domestic setting. This course endeavours to provide the basic understanding and tools to evaluate, finance, and manage international business. The issues and tools discuss are particularly relevant to highly open economies, such as Singapore, where companies will engage in international business. In this course, we will describe the global financial markets that facilitate international business and explain the key economic linkages among them. In the context of international finance, understanding foreign exchange rates is crucial. We will therefore explain exchange rates and those factors that affect the rates. We will then examine the challenges for companies created by unexpected changes in exchange rates. We will also discuss how these firms should manage their exposure to currency fluctuations. Lastly, we will explore areas of international corporate finance like capital budgeting and financing from the perspective of multinational companies.