This course will cover issues related to both international financial markets and the financial operation of a firm within the international environment. The first part of the course will examine issues related to the international markets, including international commercial policy, international capital flows, foreign exchange markets, the international money markets, and currency derivative markets. The second part of the course will consider financial issues associated with the operation of a firm in the international environment. Specifically, this part of the course will focus on the identification, measurement, and management of the impact of exchange rate changes on the firm, the additional complexities associated with identifying the expected cash flows in a cross border investment project, measuring a foreign projectís cost of capital; and corporate financing opportunities in a global market. While the course discusses theoretical basis on the various issues, it relies on both empirical evidence and discussion of firms' real world activities. The course style is mostly lectures with some class discussions. It evaluates students through several quantitative problem sets, case studies, and a midterm and end of course exam.
To receive credit
for the course, each student will be responsible for writing a midterm exam and
a second exam. The midterm exam will be
FRIDAY JUNE 11, 2010 from 4:45pm-6:45pm. The second exam will be
SATURDAY AUGUST 7, 2010 during the morning session.
Students will also be responsible for handing in several problem sets and case
write-ups as part of a study group. The final grade will be determined by the
| First Exam
| Second Exam
| Cases/Problem Sets
| Group/Class Participation
The participation portion
of the grade is based upon general class participation and group participation
as evaluated by your group members. To promote classroom participation,
discussion is evaluated only on involvement and quality rather than on the
particular position taken. Please note that 40% of the grade is determined by
group activities so keep this in mind when forming study groups.
A bulk pack will be provided for the
non-textbook readings of the course. Other handouts, such as problem sets,
cases, case setups, and class notes will be provided as necessary throughout
the course. Students will also receive a copy of the course slides at the
beginning of each session. Much of this material can also be downloaded from
the course website.
The textbook provided for this course is:
International Financial Management, 5nd Edition, by Eun and
Resnick, publisher: Irwin/McGraw Hill, 2008. ISBN: 9780073382340
Chapters from this book are listed in the
syllabus as IFM and provide useful background and additional discussion of the
topics discussed in class. Due to time considerations, we will not cover all
of the topics in the text, although it is highly recommended that you read the
entire text. In addition it will be assumed that students are thoroughly
familiar with an introductory corporate finance textbook.
In addition to the text and the required
readings, avid students of international finance will wish to stay on top of
current issues by following additional sources on information. Recommended
The Economist - good economic analysis
of occasional related issues.
Financial Times - good international company
and capital markets section.
Euromoney - great international finance
and banking coverage - a big read.
Corporate Finance - excellent corporate finance magazine - specialized for
Global Finance - good overall magazine for practical international finance
Student subscription rates
are available for some of these publications. Click here
for more information.
I often refer students to web sites for additional reading material as well as
current events news, and additional information on a topic, or information that
would be helpful for a problem set or case. Thus it will be assumed that people have both access and the knowledge
necessary to navigate around the worldwide.
Each member of the
class is encouraged become part of a study group consisting of three to five
students. This group will work together and prepare answers to the discussion
cases/problem sets (however, any student may elect to submit a minority opinion
on an issue, if desired). Once a group is formed it cannot be changed, so
please choose your groups carefully. Issues regarding free riding,
shirking, etc. in group work are often more severe in the last year of a
program, so be sure that you and your group internalizes such issues when
forming. At the end of the course, group members will be asked to confidentially
evaluate the participation of the other group members as an attempt to
externally control such behavior. This evaluation will impact on the studentís
class participation score.
group should choose an unique group name to identify themselves over the
term. Please include this group name in the file name of the electronic
problem set and case submissions. I prefer that these submissions are done
in MSWord or MSExcel.
The exams are closed book although I will provide an equation sheet as the
memorization of economic and financial formulas is not the goal of this course.
Students need only bring a calculator and writing utensils to exams.
Absences from exams must be arranged in advance and make-up exams must be taken
in advance of the actual exam unless there is a confirmed medical excuse.
For all exams students are expected to follow the Wharton honor code.
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This class operates under the Wharton Honor Code. Students are expected to do their own work (or work within their group). At no time is it permissible to use materials from former students or other sources that relate to problem sets or exams other than what is currently provided on the course website. Violations of this rule will be treated as a breach of the Honor Code.
Cases and problem sets are to be submitted via email by the time at date
indicated on the class outline. The problem sets are meant as exercises to
practice some of the material. Answers will be provided for the problem sets.
Some of the cases will be the topic of discussion for a part of the class
period, while others are meant purely as homework. Students should bring to
class a copy of the case material for class discussion when indicated.
As with the real world, all of the cases are written to focus on issues, not
answers, and as such are somewhat ambiguous. There are no "right answers" to
the cases, only good arguments and bad arguments for taking particular actions
or decisions, especially on the corporate cases. Unlike other finance courses,
there is sometimes a limited amount of quantitative information on which to make
a decision and thus it is often impossible to compute an exact answer as might
be done in other courses.
will attempt to make myself available during the Friday/Saturday periods in
which you are on campus in order to answer questions. I am usually available
after class periods or during the lunch breaks. On double class weekends I
will be available on Friday evenings for additional questions.
In addition, I am an avid user of e-mail.
My email address for the course is email@example.com. If you wish to speak to me directly, my office number
is (202) 663 - 7731.
There is also a TA for the course. His name is Alex Demyanets. He is a PhD student at SAIS. He has been the TA this course for several years and is very capable of answering questions. His email is firstname.lastname@example.org.
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Last updated April 25,2010