BLOCK I: BASICS OF FOREIGN EXCHANGE MANAGEMENT

BLOCK I: BASICS OF FOREIGN EXCHANGE MANAGEMENT-

UNIT 1: Foreign Exchange: Concept and Significance – Foreign change Rate: Direct and indirect quotations – Interbank and Merchant rates.

UNIT 2: Spotrates and forward rates – T.T. rates – Crossrates; Computation – Foreign exchange markets- Organisation offorex market.

UNIT 3: Determination of Exchange Rate: Purchasing Power Parity theory – Interest rate parity theory – Flow model -Asset market model.

UNIT 4: Forecasting of exchange rates- Concepts of Nominal Effective Exchange Rate and Real effective Exchange rate.