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2019/2020  BA-BHAAI1067U  Undergraduate International Finance

English Title
Undergraduate International Finance

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Bachelor
Duration Summer
Start time of the course Summer
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 140
Study board
Study Board for BSc in Economics and Business Administration
Course coordinator
  • Thomas Lindner - Department of Accounting (AA)
For academic questions related to the course, please contact instructor Thomas Lindner at tli.acc@cbs.dk
Main academic disciplines
  • Corporate governance
  • Finance
  • Globalisation and international business
Teaching methods
  • Online teaching
Last updated on 16/04/2020

Relevant links

Learning objectives
This course prepares students for careers in international companies. Students learn:
  • how to evaluate projects in foreign countries
  • how to manage exposure to currency risk
  • how to manage exposure to country risk
  • how to design international corporate structure to maximize firm value
  • what challenges firms face when issuing capital abroad
  • what the options and their consequences for international investment are
  • how firms can finance foreign expansion
Course prerequisites
Fundamentals of Finance, Fundamentals of Mathematics
Examination
Undergraduate International Finance:
Exam ECTS 7.5
Examination form Home assignment - written product
Individual or group exam Individual exam
Size of written product Please see text below
4 hour home assignment. No requirement for maximum number of pages.
Assignment type Written assignment
Duration Written product to be submitted on specified date and time.
Grading scale 7-point grading scale
Examiner(s) One internal examiner
Exam period Summer, Ordinary exam: 4 hour home assignment in the period of 27–31 July 2020
Retake exam: 4 hour home assignment in the period of 28 September–2 October 2020
3rd attempt (2nd retake) exam: 72-hour home assignment- 23-26 November 2020 – for all ISUP courses simultaneously

Exam schedules available on https:/​/​www.cbs.dk/​uddannelse/​international-summer-university-programme-isup/​courses-and-exams
Make-up exam/re-exam
Same examination form as the ordinary exam
Retake exam: 4 hour home assignment, new exam question
Exam form for 3rd attempt (2nd retake): 72-hour home project assignment, max. 10 pages.
Course content, structure and pedagogical approach

This course introduces students to the challenges and opportunities firms face in international financial markets. The course investigates how firms can manage exposure to different forms of risk resulting from international operations. First, we look into currency markets and develop tools firms can use to manage exposure to several currencies. We also look into opportunities this provides for the diversification of risk and how exposure to foreign currencies has consequences for firm strategy. Second, we investigate how firms can navigate different tax and institutional regimes to optimize capital structure and the allocation of profits to business units. Third, we look at the integration of capital markets and challenges firm face when issuing securities abroad. Finally, the course covers means of valuing and managing investments in foreign currencies. Taken together, the course is designed to prepare students to answer questions about strategic implications of internationalization using tools based on financial analysis.

 

Preliminary assignment: read Agmon (2006)
Class 1: Introduction to international finance and country risk
Class 2: International capital budgeting
Class 3: Case study on international capital budgeting (I)
Class 4: Case study on international capital budgeting (II)
Class 5: Case study on international capital budgeting evaluation and discussion
Class 6: International currency markets and hedging
feedback activity: In-class quiz and discussion of answers
Class 7: Taxes and capital structure in the multinational firm
Class 8: Real options, joint ventures, and international M&A
Class 9: Project finance
Class 10: Case study on international capital budgeting
Class 11: Exam preparation and Q&A
 

 

 

Description of the teaching methods
This year all courses are taught digitally over the Internet. Instructors will apply a mixture of direct teaching through a live link (like Skype, Team, Zoom…) and indirect, where visual pre-recorded material is uploaded on Canvas. The instructor will inform participants about the precise format on Canvas.
Feedback during the teaching period
Students will have the chance to see their progress in a mock-exam. A Q&A session will help clarify remaining questions on the first half of the course.
Student workload
Preliminary assignment 20 hours
Classroom attendance 33 hours
Preparation 126 hours
Feedback activity 7 hours
Examination 20 hours
Further Information

Preliminary Assignment: To help students get maximum value from ISUP courses, instructors provide a reading or a small number of readings or video clips to be read or viewed before the start of classes with a related task scheduled for class 1 in order to 'jump-start' the learning process.

 

Course timetable is available on https://www.cbs.dk/uddannelse/international-summer-university-programme-isup/courses-and-exams

 

We reserve the right to cancel the course if we do not get enough applications. This will be communicated on https://www.cbs.dk/uddannelse/international-summer-university-programme-isup/courses-and-exams end March 2020.

Expected literature

Mandatory readings:

 

Case: Globalizing the Cost of Capital and Capital Budgeting at AES (HBS case: https:/​/​hbsp.harvard.edu/​product/​204109-PDF-ENG?itemFindingMethod=Search).


Papers:
Agmon, T. (2006). Bringing financial economics into international business research: Taking advantage of a paradigm change. Journal of International Business Studies, 37(5), 575-577.

 

 

Additional relevant readings:

 

Chapters 17, 18, and 22 in Sercu, P. (2009). International finance: Theory into practice. Princeton University Press.


Chapters 19-25 in Buckley, A. (2012). Multinational finance. Pearson Education.


Chapters 2-6,12, 14-16 in Butler, K. C. (2016). Multinational Finance: Evaluating the Opportunities, Costs, and Risks of Multinational Operations. John Wiley & Sons.


Chapters 1, and 2 in Gatti, S. (2012). Project finance in theory and practice: designing, structuring, and financing private and public projects. Academic Press.

 

Last updated on 16/04/2020