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HBF 2401: International Finance Notes

Institution: Jomo Kenyatta University of Agriculture and Technology

Course: Bachelor of Commerce

Content Category: Lecture Notes

Posted By: PENTAMRK

Document Type: PDF

Number of Pages: 112

Price: KES 200
 
    

Views: 409     Downloads: 6

Summary

LESSON 1
Introduction To International Finance
Learning outcomes
At the end of this chapter, the student should be able to:
1. Define international finance and explain its significance
2. Explain international financial environment
3. Explain reasons for studying international finance
1.1. Introduction
International finance activities help organizations to engage in cross-border transactions with foreign business partners, such as customers, suppliers and lenders. Government agencies and Non-profit institutions also use international finance tools to meet operating needs.
International finance is branch of economics that studies the dynamics of exchanges rates, foreign investment and how these affect international trade. International finance covers all procedures, techniques and tools that financial institutions, such as banks and insurance companies provide to clients. These tools may include financing agreements and transaction strategies on securities exchange. In other words international finance is the study of the institutions, policies, and practices that govern global financial management and/or financial aspects of global business.
1.2. Significance of international finance
International finance plays a significance role in modern economies. Business transactions are not only interconnected more than ever before, but must companies engage in multinational activities through exports or import.
Some of the benefits of international finance are:
• Access to capital markets across the world enables a country to borrow during tough times and lend during good times.
• It promotes domestic investment and growth through capital import.
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