整理版国际金融 英文思考题汇总-yg.doc

国际金融课后思考题汇总 10金2 1. Whats Real Effective Exchange Rate?Real effextive exchange rate is an effective exchange rate based on real exchange rates as opposed to nominal exchage rates.On the one hand,it is a kind of effective exchange rate which is a measure of the weighted-average value of a currency relative to a selected group of currencies.On the other hand,it is based on real enchange rate although calculated in much the same way as a nominal effective exchange rate.In contrast to calculating effective nominal exchage rates,however,we use real exchage rates in computng the real effective exchange rate.2. Talk about the measurement of Exchange ratechange.In general,there are mainly three measurement of exchange rate change.The first is the point of enchange rate change.The second is the percentage of exchange rate change,which is the difference between the final exchange rate and the initial exchange rate as a percentage of the initial exchange rate during a certain period.The third measurement is the exchange rate index,including the bilateral exchange rate index and the effective exchange rare index.3. The Three level(三个层次) of foreign exchange market. Foreign exchange transaction between the centre bank and bank.Foreign exchange transaction between banksForeign exchange transaction between bank and client.3.71. Whats the foreign exchange arbitrage（套汇）? Foreign exchange arbitrage is the act of buying a currency at one price and immediately selling it at a different price. Spatial arbitrage refers to arbitrage activities that span separate markets. Triangular arbitrage refers to arbitrage activities in which the foreign exchange transaction involves more than two currencies. 2. Whats the interest parity? (covered interest parity)?we assume that there is no transaction cost，and capital can flow freely，and capital scale for arbitrage is unlimited .Covered interest parity is a condition that says that the difference between the interest rate on a domestic financial asset and the interest rate on a foreign financial asset should approximately equal the forward premium or discount.3. Look at chapter 5, talk about in what ways does a currency futures（货币期货） contract differ from a forward currency contract?期货与远期合约比较：Futures contracts specify standardized quantities and terms of exchange. Futures contracts require daily cash-flow settlements. The futures exchange is an organized market and has high Liquidity.货币期货与远期外汇：一、国际金融英语版P1231、Currency futures contracts entail daily cash follow settlements， whereas currency forward contracts entail a single settlement only at the date of maturity. （期货每日清算制度）2、Futures contracts typically involve smaller currency denominations as compared with forward contracts.3、Large banking institutions and corporations that transmit large volumes of foreign currencies are the primary users of forward contracts. individuals and smaller firms that wish to undertake hedging or speculative strategies typically trade currency futures.（远期外汇交易主要参与者是金融机构和企业，外汇期货则自然人和机构）二、补充（书P43）4、Currency futures contracts have higher liquidity and can be transferred freely while currency forward contracts cannot.5、buyers and sellers of Currency futures contracts need to pay Future guarantee by a certain ratio .以上感谢828蝈蝈丹梅泥巴蚊子写得巨详细有木有（后面就省略评论了） 3.191. Whats the determinant of options premium（期权费）?The determinant of option premium is the competition between supply and demand of the option in the market, which was influenced by the following 3 factors: the options intrinsic value , the option s time value and potential variability of the underlying asset.Intrinsic value is the asset appreciation from performing the option contract. It depends on the difference between spot exchange rate and trading exchange rate. A higher or lower difference will influence the buyers possibility of performing the contract, than make a different on option premium.Time value is the part of value decided by the length from trading date to expiry date. In most cases, the longer the time is, the higher the option premium will be.When other conditions are same, a greater potential variability of the underlying asset will makes a higher option premium.2. What is foreign exchange risk（外汇风险）? Foreign exchange risk is the effect that uncertain future values of the exchange rate may have on the value of a foreign-currency-denominated obligation, receipt, asset, or liability. If economic entities are in foreign exchange activities, they are likely to suffer the loss due to a change in foreign exchange rates. There are three types of exposure to foreign exchange risk: transaction exposure, translation exposure, and economic exposure. In principle, an individual or firm can offset, or hedge, some or all of the exposure to foreign exchange risk. The individual or firm covers the exposure by completely eliminating the risk.3. Talk about the differences among the three types of foreign exchange risk.An individual or firm may be exposed to foreign exchange risk in any of three different ways.Transaction exposure is the risk that the cost of a transaction , or the proceeds from a transaction, in terms of the domestic currency, may change. A transaction exposure is created when a firm agrees to complete a foreign-currency-denominated transaction some time in the future.The second type of foreign exchange risk is translation exposure, which arises when translating the values of foreign-currency-denominated assets and liabilities into a single currency value. The final type of foreign exchange risk is economic exposure, which is the effect that exchange-rate changes have on a firms present value of future income streams. Economic exposure affects the ability of a firm to compete in a particular market over an extended period. Some economists believe that at least a portion of foreign direct investment results from firms trying to avoid economic exposure. By owning a plant or office in a foreign location of operation, the firm may avoid some of the foreign exchange risk that it would have incurred if all its plants and offices were in domestic locations only. thank董方同学3.211. Whats economic risk?The economic risk is the effect that exchange-rate changes have on a firms value of future income streams. Economic exposure affects the ability of a firm to compete a particular market over an extended period. By owning a plant or office in a foreign location of operation, the firm may avoid some of the foreign exchange risk that it would have incurred if all its plants and offices were in domestic location only. 以上感谢830圈董方天哥贤姐2. Whats the two method of foreign exchange rate prediction?(参考第四讲ppt第19-28张ppt) The two methods are fundamentalist(基本因素分析法) and chartist(技术分析法). Fundamentalist is based on analyzing the relationship between economic variables (such as balance of payment, money supply, the change of inflation rate, interest rate and the growth of GDP, etc.) and the exchange rate. Fundamentalist can be divided into two methods: 主观判断法和计量经济模型法. Fundamentalist can better predict long term foreign exchange rate fluctuation.The predicting method of Chartist is based on analyzing the foreign exchange markets internal supply and demand. It mainly depends on chart analyzing and statistic methods, K线法 is one of them. Chartist can better predict short term foreign exchange rate fluctuation. Chartist focuses on market price, markets turnover and the amount that havent been closed out(未平仓量). Chartist can also be divided into graph analyzing and trend analyzing. 3. Whats the international capital flow? How many kinds of it?International capital is the behavior of capitals flowing internationally to seek profit. In most cases, it means a capital holders investing in a foreign countrys industrial or financial department and the procedure withdrawing his invest back. It includes three main methods: International direction investment, international portfolio investment and international loan.3.311. Look at the English Textbook, and talk about the feature of capital flows to the emerging economies（新兴经济体）.1. Capital flows are separated into foreign direct investment and portfolio investment. In 2000, portfolio capital flows turn negative. FDI flows remain relatively robust. 2. Private capital flows to the emerging economies have grown at a remarkable rate since 1990. 3. Though the emerging economies of East Asia attracted substantial FDI flows during the mid-1990s, they relied heavily on portfolio, bank loans and other capital flows.2. Whats the fundamental reason for capital flows? The fundamental reason of capitals international flow is the difference of 资本收益率 among countries. The above 4 questions answers are from 杨光 and 陈饶尤4.91. Whatare the major consequences of international capital flow?1）It will help to improve the efficiency of global capital and the rational allocation of resources.2） It will contribute to the improvement of global and national output and economic welfare enhancing.3）International capital flows will lead to the redistribution of interests between different classes of the countries Other economic benefits of international capital flows1、 Help to promote the development of the global balance of payments, to promote international trade and investment is carried out smoothly.2、 Contribute to the spread of science and technology in the international community，and promote the progress of world technology.3、 (For the outflow country) Get more Overseas investment income；improve current account and balance of payments；promote commodity exports；expand overseas market share；create employment opportunities(For the inflow country)add domestic savings; Increases the capital accumulation; introduce of foreign technology and management experience; Promote financial development;Promote competition in the domestic market, improve business efficiency; promote macro economy developmentNegative effect1、 Exchange rate fluctuations and financial turmoil2、 Independence and efficiency of a countrys currency policy decrease3、 (capital inflow country) excessive capital flow into，may lead to debt crisis and other crisis4、(capital outflow country) trade deficit, negative effect of job creation, domestic income and taxation2. What are the capital control and capital account liberalization（资本账户自由化）?Capital controlsare measures such astransaction taxesand other limits or outright prohibitions, which a nations government can use to regulate the flows into and out of the countryscapital account. (Types of capital control include exchange controlsthat prevent or limit the buying and selling of a national currency at the market rate, caps on the allowed volume for the international sale or purchase of various financial assets, transaction taxes such as the proposed Tobin tax, minimum stay requirements, requirements for mandatory approval, or even limits on the amount of money a private citizen is allowed to remove from the country).capital account liberalization usually refers to one country allows a variety of free movement of capital in its capital account, namely residents free access to international financial markets, investment and financing, non-residents can also have free access to domestic financial markets, investment and financing.4.151. What are themain reasons for capital account liberalization?(1) The promotion of economic globalization, especially the development of trade and investment liberalization(2) The less effectiveness of the capital controlFor industrialized countries:1. Private enterprises will be more easier to expand their business overseas2. Reducing the cost of financing of domestic enterpriseFor developing countries1） Ease the currency appreciation or depreciation pressure, and promote the macroeconomic stability2） Easier to attend global organizations2. What is the financial crisis（金融危机）? the main type.An imbalanced economic phenomenon that under the strikes of both inside and outside, most or all financial assets become volatile exceedingly at size and price in a period of time, which makes the financial market cannot function well ,and affect the real economy. Main types:Currency crisisBanking crisisForeign debt crisisSystemic financial crisis 以上感谢209锋锋姐姐朋朋明明4.191. What are the different explanations for the currency crisis? (Bank crisis, foreign debt crisis)Currency crisis:(direct) speculative attacks; (possible) recession of macroeconomy, variation of anticipation and govts discretionary approaches; morality hazard, financial institution deteriorate; financial crisis spreadBank crisis:(direct) incapability on payment; (possible) economic cycle variation; asymmetric information morality hazard; psychological issue, a run on the bankDebt crisis: liquidity problem, solvency problemSystematic crisis: comprehensive factors2. Whats the relationship between capital flows and financial crisis?1) Short term capital flow speculative attack2) International capital flow financial crisis spread3) Capital inflow macroeconomy imbalance4) Capital inflow fragile bank system5) Excessive foreign debt6) Outflow and inflow of international portfolio market volatile portfolio market4.241. Whats the difference between onshore transaction and offshore transaction（离岸交易）?onshore transactionoffshore transactionloan relationships(借贷关系)Between resident and non-residentBetween non-resident and non-residentfinancial control（金融管制） Under control of domesticfinancial laws and tax law Almost out of control of domestic financial laws and tax lawCurrency of transaction(交易货币)Home currencyOff-shore Currencyscope of business（业务范围）international financing、trade settlement、insuranceinternational financing alone2. The classification of international financial market.The international financial markets are the markets for cross-border exchange of financial instruments.The structure of the international financial market can be divided from different angles. According to the traditional classification, The international financial markets can be divided into international money market, international capital market, International foreign exchange market and International gold market.Typically, there is a distinction made between international money market and international capital market. International money markets are markets for exchange of financial instruments with maturities of less than one year, while international capital markets are markets for cross-border exchange of financial instruments with maturities of one year or more.According to the IMF and OEDC classification method, it can be divided into international credit market, international debt security market, international stock market, international financial derivatives market, international foreign exchange market and international gold market. Among them, the international credit market can be divided into bank short-term credit market and bank medium and long-term credit market.According to the transaction object area and trading currency division, it can be divided into onshore financial market and offshore financial market.3. Whats Eurocurrency market（欧洲货币市场）?A Eurocurrency market is a market for the borrowing and lending of Eurocurrency deposits, which is the main part of the international financial market. 以上感谢琼姐婧思娟娟思奇4.291.What is interest rate swap?(胡聂风)It is an important type of swap on international financial markets. This is a contract under which one party commits itself to exchange a set of interest payments that it is scheduled to receive for different set of interest payments owed to another party.(书上)Interest Rate Swaps are contracts between two or more parties, called counterparties, in which they agree to exchange (or swap) streams of future debt payments. Interest rate swaps are derivative securities, traded Over-the-Counter, not on a stock exchange. （网络）2. The exchange rate determinants under the Gold Standard（金本位制）.Mint par: the rate a kind of currency , the other is the rate gold contain of the currency to gold contain for the other.If supply demand, exchange rate less than mint parIf supply demand, exchange rate exceed gold pointExchange rate would never exceed gold point (or gold would be chosen to exchange directly)5.21. Whats Purchasing Power Parity（购买力平价）?PPP is a condition that states that if international arbitrage is unhindered, ignoring transportation costs, tax differentials, and trade restrictions, the price of a good or service in one nation should be the same as the exchange-rate-adjusted price of the same good or service in another nation.2. What are the differences between UIP（不抵补套利） and CIP?Uncovered interest parity is a condition relating the interest differential of similar financial instrument of two nations to the excepted change in spot exchange rate between the two nations.Uncovered interest arbitrage refers to funds from the low interest rate currencies to high interest rate currencies, thereby earning the rate difference of income, but not at the same time trade against unwinds positions. This kind of arbitrage to withstand the high interest rate currencies devalues risk, speculative(投机性). Covered interest parity is a condition that says that the difference between the interest rate on a domestic financial asset and the interest rate on a foreign finan