MOCK EXAM QUESTIONS 1. FINANCE-Discuss the concept of transaction risk in international financial management.

(The students have to define the transaction risk, as a risk that arises from operating in more than one currency, i.e. where the obligation has arisen in one currency, but the payment may be made in another). 2. FINANCE- Discuss the Interest Rate Parity Theory (The students should define interest Rate Parity theory in FOREX operations , and outline the main situations in which the theory holds) LECTURE3 SLIDE19
3. ECONOMICS-British Airways-owner IAG has announced 4,500 job

cuts at Iberia as part of a widely anticipated restructuring of the Spanish carrier . Iberia is cutting its 156-strong fleet by 25 aircraft, and reducing 15% of its network capacity, with the airline focusing on the most profitable routes. "Iberia is in a fight for survival. ........ It is unprofitable in all its markets. .........As a global industry, airlines and governments are unable to duck the issue of labour competitiveness." (Rafael Sanchez-Lozano, Iberia Chief Executive, http://www.bbc.co.uk/news/business-20264407, 9 November, 2012) The airline industry is said is becoming increasingly oligopolistic in nature. Critically discuss the main features of an oligopolistic market and consider the extent to which you think these apply to the airline industry.

4. China has recently announced plans to initiate a new wave of economic growth by ex-panding domestic consumption to offse t declining export demand . Financial reform is seen as a key to unlocking future growth: Domestic lenders now have the flexibility to determine the interest rates at which they will lend to consumers (within a stipulated range), the yuan has been allowed to trade against the US dollar at 1.0% on either side of a daily rate set by the central bank (the previous limit was 0.5%) and China's securities regulator has eased entry rules for foreign investors under its Qualified Foreign In-stitutional Investor (QFII) programme to attract more long-term overseas investment. (Source: http://www.bbc.co.uk/news/business-20248116). Explain, using economic theory and concepts how national

income is determined. Consider how the Chinese plans to boost economic growth outlined above would work. 5. Discuss the role and functions of the European Commission. 6. Discuss the effects of globalization on states capacity to deliver policies and how that reflects on peoples perceptions about their governments. 7. How has the Lisbon treaty contributed reshaping the European Union decision making process?