School Of Business Administration
Syllabus
Course Title
Course Number
Semester
Instructor
Office Phone
Email
Office
Office Hours
appointment.
Web Site
: International Economics and Finance
: iMBA-700
: Spring 2016
: Dr. D.K. Malhotra
: (215) 951-2813
: MalhotraD@philau.edu
: 104 Tuttleman
: 11:00 a.m. - 12:30 p.m. Monday and Wednesday or by
Credits
Course Type
: 3.0
: 3-0-3
: http://faculty.philau.edu/MalhotraD
Prerequisites: All iMBF Courses and iMBA629 Financial Policy and Planning.
It is the students' responsibility to make certain that they have successfully completed
these courses. If at any time during the semester it is learned that a student has not
successfully completed these prerequisites, he/she will be dropped from the course
receiving, neither credit nor tuition refund.
Course Description:
This course explores interrelations between economic theories of
trade/growth/development and financial applications in global markets,
emphasizing techniques and practices relevant to international management.
Topics include international trade, comparative and absolute advantage, benefits of
trade and costs of trade disruption, balance of payments, foreign exchange markets
and risk, the international financial system, and portfolio effects of capital budgets
on multinational and international capital markets. Students explore current issues
of concern to various constituents, such as environmental problems, organizing for
optimal results, sources and uses of funds, and accounting, tax, and control issues.
Course Objective:
The objective of the course is to teach students how to approach and solve the
fundamental financial problems facing multinational corporations. Each topic
explored in the course represents a real-life financial problem facing a multinational
"firm". Much of what the students will learn currently is in use in firms across the
nation and other countries. Projects and case studies have been included to ensure
better understanding of the subject matter.
Required Text(s) and/or Supplies:
Multinational Financial Management by Alan C. Shapiro, John Wiley and Sons,
ISBN#978-1-118-57238-2
Additional Recommended Readings:
The Wall Street Journal; Barron’s Paper; Corporate Finance
Attendance:
Attendance is mandatory. You are responsible for what is covered in the class and
any absence on your part leaves you responsible for finding out what was presented
in class. You will benefit a lot from the course by doing problems and reviewing
concepts which are covered in the class. For every class that you miss without a
valid excuse, there will be a penalty of four points from your final grade.
Course Outcomes:
Upon course completion, students will be able to:
 Assess implications of balance of payments deficits or surpluses on global
stability
 Describe the functioning of foreign exchange markets and determination
of exchange rates
 Evaluate the different types of exchange rate systems in historical context
 Differentiate various types of exchange rate risks and devise a strategy to
manage these risks
Overview of expectations for the course, including major assignments or
projects:
Assignments
Weight
Evaluates which Course
Outcomes?
Homework Assignments
20%
Outcomes 1, 2, 3, and 4
Midterm Exam
Final Exam
Country Risks Analysis Project
Class Participation
30%
30%
10%
10%
100%
Outcomes 1, 2, 3, and 4
Outcomes 1, 2, 3, and 4
Outcomes 1, 2, 3, and 4
Outcomes 1, 2, 3, and 4
Grade Distribution:
Letter Grade
A
AB+
B
BC+
C
CF
Grade
Points
4.00
3.67
3.33
3.00
2.67
2.33
2.00
1.67
0.00
Percent Allocated
93% or higher
90% to < 93%
87% to < 90%
83% to < 87%
80% to <83%
77% to <80%
73% to <77%
70% to <73%
<70%
Academic Integrity
Academic integrity is a policy about ethical behavior at Philadelphia University
regarding one’s intentions, decisions, and actions while conducting academic work.
It includes values such as avoidance of the following: cheating; plagiarism; copying;
the fabrication of information; and facilitating, or denying others access to
information. It expects honesty and rigor in research, course work, writing and
publishing. Academic Integrity is taken seriously in this course. Any student
violating the University’s academic integrity policy will be subject to appropriate
sanctions. The University’s complete academic integrity policy is available in the
Academic Catalog and University’s Student Handbook. Academic resources,
including information on citation and documentation for all written work, projects,
and presentations, are also available on the Learning and Advising Center’s website:
http://www.philau.edu/learning/writingguidelines.html.
Policy on Lateness, Absences, Makeup Work
In accordance with University policy, students are expected to attend class every
day with all relevant required course materials and work. If you are absent from
class, contact your faculty as soon as possible, preferably before the next class
meeting. Students remain responsible for any missed work, for work completed in
class and for work due and must arrange for that work to be delivered to the faculty
on time.
Serious illness, family emergencies, or other crises mean that students should
contact the Dean of Students Office as soon as possible (215-951-2740) and follow
up with a direct explanation to the faculty. Students are responsible for all work
related to this class; however, faculty may (but are not required to) make some
accommodation in terms of time of delivery and/or make-up exams for major tests.
Please consult with your faculty and your academic advisor to determine whether
you should withdraw from the course or request an incomplete grade in the case of
serious illness or crises.
Attendance:
Attendance is mandatory. You are responsible for what is covered in the class and
any absence on your part leaves you responsible for finding out what was presented
in class. You will benefit a lot from the course by doing problems and reviewing
concepts, which are covered in the class. If you miss a class without a valid
excuse, there will be a deduction of 4 points from your final grade. If you miss
half of the class, two points will be deducted from your final grade.
Collection of Student Work for Assessment
Philadelphia University is committed to providing excellent and innovative
educational opportunities to its students. To help us maintain quality academic
offerings and to conform to professional accreditation requirements where relevant,
the University and its programs regularly examine the effectiveness of the curricula,
teaching, services, and programs the University provides. As Philadelphia University
sees appropriate, it may retain representative examples or copies of student work
from all courses. This might include papers, exams, creative works, or portfolios
developed and submitted in courses or to satisfy the requirements for degree
programs as well as surveys, focus group information, and reflective exercises.
Digital Resources
This course is available on blackboard at http://bb.philau.edu
Gutman Library (www.philau.edu/library)
Gutman Library is a gateway to a variety of information resources. The homepage of
the library provides 24/7 access to online databases of articles, e-journal
collections, e-books, and specialized information to support this course. The library
building is wireless, has 80 available workstations (PCs and Macs), printers,
scanners, and copiers; as well as individual and group study spaces.
The following databases available in the library will be useful in this course:
ABI/Inform and Business Source Premier
Wall Street Journal
Wall Street Journal – Asia, Financial Times
New York Times
Students can also contact the Reference Desk directly Reference@philau.edu for
more specialized help in identifying sources, or stop by the Reference Desk when
the library is open.
The Learning and Advising Center (www.philau.edu/learning)
The Learning and Advising Center provides one-on-one tutoring assistance for
writing, study strategies, test taking, and specific Philadelphia University courses*.
To make a tutoring appointment, students should stop by the Learning and Advising
Center in Haggar Hall or call (215) 951-2799. Academic resources, including
information on citation and documentation, note taking, and study strategies are
available on the Center’s website.
Technology Resources (http://www.philau.edu/OIT/)
The campus is wireless. If you need a computer, Gutman Library and Search Hall
have open access computers. For assistance with technology issues, students should
contact the Technology Help Desk at (215) 951-4648 or send an email to
helpdesk@philau.edu.
Case Reports: The cases should be presented in a manner acceptable in a large
corporation. The decision as well as the qualitative and quantitative reasons for the
decision should be communicated in a typed memo. The relevant information
should follow the memo in table form with supporting notes showing calculations.
Cases will be evaluated according to content, analysis, presentations, and continuity.
If any two cases are identical, plagiarism will be assumed and no credit will be given to
either case.
ADDITIONAL INFORMATION:
CASE ASSIGNMENT REQUIREMENT:
Case reports must be submitted as per the following format:
1. Title Page:
Name of the Case
Prepared by
Course Number
Date
2. Executive Summary
One half to one page summary of the issues involved and the strategy and
recommendations must be included.
3. An analysis of the case on the basis of the questions given at the end of the case.
Your analysis of each question must include the following:
Issues Involved
Strategies to deal with those issues
4.
Recommendations with rationale
Length of Case Preparation: 4-5 pages
5. Papers are to be word-processed with correct grammar and punctuation.
Information in the papers must be properly documented.
Guideline: Consult other business communication books on business reports
Tentative Course Outline:
01/13 Introduction to International Economics and Finance
 International Trade, International Production, International Finance, and
International Development
 How do they connect?
 How does international trade lead to globalization?
 The link between International Trade and Development
 The Rise of Multinational Corporation
 The Process of Overseas Expansion
Readings:
Read Chapter 1 in the book
Read Power Point Notes
Read Additional readings handed out in class
01/20
The Foreign Exchange Market
 Organization of the Foreign Exchange Market
 The Spot Market
Readings:
Read Chapter 7 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
01/27
The Foreign Exchange Market
 The Forward Market
 Arbitrage
 Exchange Rate Determination—Forces of Demand and Supply of a
Currency and how they determine the equilibrium exchange rate
 What influences demand and supply of a currency?
Readings:
Read Chapter 7and Chapter 2 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
02/03
Readings:
Parity Conditions in International Finance
 The Purchasing Power Parity
 The International Fisher Effect
Read Chapter 7and Chapter 4 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
02/10
Parity Conditions in International Finance
 Interest Rate Parity Theory
Readings:
Read Chapter 7 and Chapter 4 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
02/17








The Balance of Payments
The Political Economy of Trade and Trade Policy Analysis
The Balance of Payments
Current Account
Capital and Financial Accounts
International Trade Flows
Correcting a Balance-of-Trade Deficit
International Capital Flows
Agencies that facilitate International Flows
Readings:
Read Chapter 5 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
Mini case discussion: Warren Buffet offers a solution to America’s Trade Deficit
02/24
International Monetary System




Alternative Exchange Rate Systems
Fixed Exchange Rate System
Floating Exchange Rate System
EURO
Readings:
Read Chapter 3 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
03/02
International Monetary System
 Currency Board/Pegged Exchange Rate System
 Government Intervention in Currency Markets
Readings:
Read Chapter 3 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
03/09
Currency Futures and Options
 Futures Contracts
 Currency Options
Readings:
Read Chapter 8 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
03/23
Currency Futures and Options
Readings:
Read Chapter 8 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
03/30
Exchange Rate Risk
 Meaning of Exchange Rate Risk
 Types of Exchange Rate Risks
 Measurement of Exchange Rate Risk
Readings:
Read Chapter 10 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
04/06
Measuring Transactions, Accounting, and Economic Exposure
 Measurement of Transaction Exposure
 Measurement of Translation Exposure
Readings:
Read Chapter 11 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
04/13 Management of Transaction, Accounting, and Economic
Exposure
 Management of Transaction Exposure
 Management of Translation Exposure
 Management of Economic Exposure
Readings:
Read Chapter 11 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
04/20
Foreign Direct Investment
Readings:
Read Chapter 16 in the Shapiro Book
Read Power Point notes
Read Additional readings handed out in class
04/27
Student Presentation of Country Risk Analysis Project
International Finance
MBA 774
Country Risk Analysis
Spring 2015
Due Date: April 22, 2015
You work as a junior analyst with a multinational firm. Your firm is think of
expanding into a new country. You have been asked by your boss at the firm to
analyze a country (of your own choice) and submit a report to him stating
whether that your company should expand into that country or not so that your
boss can make appropriate changes in his strategy accordingly. You should
provide a recommendation, which "YOU" think, is correct and not what other
"experts" think is correct.
· You must provide the name of the country that you want to analyze by February
4, 2015
· You may not be able to change the country for your project after the initial
selection.
· You must submit the project by the due date. If you do not submit the project by
the due date, you will lose three points from the score for your project.
· If you choose not to do the project, you will receive an "F" in this course.
Your report should be organized along the following lines.
Format:
1. Your report should start with a clear-cut recommendation as to whether we
should expand into that country along with a summary of the reasons
2. Discuss each and every reason in detail.
3. Attach a copy of all your sources of information to substantiate your
arguments.
Your report should not exceed ten pages (excluding supporting documents).
Your reports will be graded on the basis of logical reasoning, completeness, and
the appropriateness of your writing strategy. Since this is a professional report, it
requires the use of a non-sensitive message; the tone of your report should be
direct, professional, and non-emotional.
Consult a Business Communications book to learn more about writing a
business/project report.
Sources of Information for Your Project:
1. Euromoney
2. Asiamoney
3. Business Week
4. Lexis-Nexis
5. Dept. of Commerce Reports on Individual Countries
6. The Economist
7. Far-Eastern Economic Review
8. The Wall Street Journal
9. The Asian Wall Street Journal
10. The World Wide Web
11. International Business Magazine
Various issues of Euromoney will be very helpful in completing this project.
Due Dates:

Two page proposal due by January 28, 2015 (5%)
o Proposal should provide reason for choosing this country and identify
sources of your information to analyze this country. By this time, you
should have done library research on your country

Midterm report due by March 26, 2015 (10%)
o A report that outlines your global analysis, continent analysis, and to
some extent country analysis is needed by this deadline. It should be
about 4 pages

Final project report due by April 22, 2015 (85%)