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International Finance - Assignment PDF

Added on - 05 Oct 2021

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Running head: INTERNATIONAL FINANCE
International Finance
Name of the Student:
Name of the University:
Authors Note:
INTERNATIONAL FINANCE1
On an average AIFS provides educational and cultural exchange services to more than
50,000 students a year with an annual revenue of $200,000,000. The two primary divisions of
AIFS, i.e. college division and high school travel division are exposed to the risk of foreign
exchange exposure due to the fluctuations in foreign exchange rates. It is mainly due to the fact
that majority of the students that the two divisions serve are students who travel to Europe for
their education purposes (Ito, Koibuchi, Sato & Shimizu, 2016). The concern of AIFS is the fact
that since majority of the students served by its primary two divisions boarding tickets to Europe,
United Kingdom and other countries thus, the fluctuation in foreign exchange rates will affect its
financial performance and position. It is essential to use effective techniques and methods to
manage the foreign exchange rate fluctuations effectively in the future. In fact out of the 50,000
students that both the college division and high school travel division of AIFS serves 25,000
students on an average travel to Europe and UK for the purpose of education. Thus, the
importance of effective management of foreign exchange exposure by AIFS is essential to the
successful operation of the organization (Ramasamy & Abar, 2015).
There are wide varieties of education programs offered by AIFS as can be seen in its official
website. The students are free to choose the best suitable educational programs to suit their
needs, purpose and objective. In fact the education service provider provides educational and
study exchange programs with 35,000 different prices. So the varieties of education services
provided by the organization is clearly understandable from the huge spectrum of study
exchange programs that it allows its students to choose from (Lastra, 2015). Academic year in
the country is from July 01 to June 30 of next year and accordingly the pricing of the services of
the college division of the organization is based. The objective while pricing the academic course
offered by the college division is to ensure that the students are provided with vest possible
INTERNATIONAL FINANCE2
educational programs at reasonable prices. High School Travel division on the other hand prices
its education courses on the basis of calendar year, i.e. from January to December of respective
years. All the prices offered by AIFS under its two primary divisions are fixed and do not change
under any circumstances for until unless new catalogue is issued (Rathke, Santana, Lourenço &
Dalmácio, 2016).
Few of the sample student educational programs offered by AIFS are provided below:
Study in LondonStudy in GermanyStudy in Spain
Program description:
3 weeks
6 weeks
9 weeks
Specialized course within 6
weeks
Specialized course within 9
weeks
Program description:
4 weeks
7 weeks
12 weeks
Specialized course within 10
weeks
Specialized course within 15
weeks
Program description:
2 weeks
4 weeks
6 weeks
Specialized course within 3
weeks
Specialized course within 6
weeks
Course fees:
For 3 weeks course $5,495.
For 6 weeks course $8495.
For 9 weeks course $10,495.
For 6 week special program
$7,995
For 9 week special program
$8,495
Course fees:
For 4 weeks course $4,695.
For 7 weeks course $6,385.
For 12 weeks course $7,895.
For 10 week special program
$6,995
For 15 week special program
$7,995
Course fees:
For 2 weeks course $2,185.
For 4 weeks course $3,125.
For 6 weeks course $4,195.
For 3 week special program
$2,995
For 6 week special program
$3,495

As per the facts of the case both divisions of the organization are quite profitable with College
division being the more profitable out of the two. On an average the college division has students
in excess of 5,000 and is certainly more profitable out of the two. With almost 20,000 students
on an average in each year the high School Travel division still lags behind the college division
in terms of profit as well as political instability (Jha, Jha & Ghosh, 2016). However, with almost
4 times more students than college division, High School Travel division is extremely important
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