BAFI 1018 – International Finance Assessment Task 2

Course code and name: BAFI 1018 – International Finance Assessment Task 2

Weight: 40%

Assignment due date: 9pm Sunday 10 October (Melbourne Time)

Length: 3000 words for the written report (excluding reference, tables and appendix) and 20 mins for the video presentation

Feedback: Feedback will be provided on Canvas.

This is a group assessment. Each group should contain 3 students. Every member of the group should equally contribute to the completion of the assignment. Each group needs to submit a Declaration of Group Work Commitment form signed by all the group members when the group is formed.

This assignment comprises two parts:

  • Part A: The written report (30%): due by 9pm Sunday 10 October 2021.
  • Part B: The video presentation of the report (10%): due by 9pm Sunday 10 October 2021

Part A: The written Report (30%):

In the report, students must demonstrate their understanding and application of the course materials to analyse and explain the factors that determine the historical movement of AUD/EUR exchange rate and predict what the rate will be on 31 December 2021. Specifically, students need to:

Task (1):  discuss the effect of Purchasing Power Parity on AUD/EUR exchange rate on 31 December 2021

Task (2):  discuss the effect of Interest Rate Parity on AUD/EUR exchange rate on 31 December 2021

Task (3): discuss the factors that affect the supply and the demand of foreign exchange and thus affect AUD/EUR exchange rate on 31 December 2021

Task (4): predict the AUD/EUR exchange rate on 31 December 2021 by developing your own theoretical model (combining any factors that you deem as important in determining the AUD/EUR exchange rate). You will need to estimate an econometric model to receive credit for this part. You will need to provide justification for your model.

Task (5) discuss any other qualitative and quantitative factors that may affect the prediction of AUD/EUR exchange rate in Task (4). Please explain why you did not include these factors in your model in Task (4).

Task (6): compare and comment based on Task (1) – Task (5) and form your final prediction for the AUD/EUR exchange rate on 31 December 2021.

For Task 1-4, you must demonstrate your understanding of the theories in Topics 1 – 6 and application of these theories in determining the exchange rate. Please show relevant data and calculations in your discussions where necessary. You must provide a brief summary at the end of each task.

The maximum count of words is 3000 words for the report (excluding reference, tables and appendix).

All report submissions must be made electronically on Canvas. A Turnitin originality report will be generated for each submission. A signed (by all group members) cover sheet must be attached to the report and submitted together with the report.

Proper referencing and citations based on the Harvard style must be used. The list of references does not count towards the word limit. You may receive 0 (zero) marks and subject to disciplinary actions by the University if you plagiarise.

 

Allocation of Marks for the Report:

Task (1) (4 marks)

Marks will be awarded based on your understanding and discussion of the effect of Purchasing Power Parity on AUD/EUR exchange rate on 31 December July 2021.

Task (2) (4 marks)

Marks will be awarded based on your understanding and discussion of the effect of Interest Rate Parity on AUD/EUR exchange rate on 31 December 2021

Task (3) (4 marks)

Marks will be awarded based on your understanding and discussion of the factors that affect the supply and the demand of foreign exchange and thus affect AUD/EUR exchange rate on 31 December 2021

Task (4) (6 marks)

Marks will be awarded based on how well you develop and justify your model as well as how well you estimate your model.

Task (5) (4 marks)

Marks will be awarded based on your understanding and discussion of any other qualitative and quantitative factors that may affect the prediction of AUD/EUR exchange rate in Task (4).

Task (6) (4 marks)

Marks will be awarded based on how well you form your final prediction for AUD/EUR combining your findings and discussion in Task (1) – Task (5).

Communication (4 marks)

Marks will be awarded based on how well the report communicates analysis, arguments and viewpoints and how well the report is written. Students are expected to provide accurate and complete citation and referencing where necessary.

Part B: The Video Presentation

You are also required to present your report and submit a video of your presentation. You need to submit the video together with the report on Canvas. The presentation should be no longer than 20 minutes. In the presentation, the group should explain and pitch their prediction of the AUD/EUR exchange rate formed in their report in a professional manner. All the group members should present and appear in the video.

Allocation of Marks for the video presentation:

Presentation skills (5 marks) Presentation content (5 marks)

 

Other Instructions

Further details will be discussed in the lecture during the semester. Each group must complete, sign and submit a Declaration of Group Work Commitment to their tutor.

Should there be any issues or disputes arising from group work, i.e. student finds him/herself cannot get along with group mates or majority of group members are not satisfied with the freeriding behaviour of a particular group member, any changes to group membership must be made by the end of Week 8, i.e. the week beginning on 13 September 2021. If changes to group membership were not made by then and the issues or disputes persist, groups which face such issues or disputes must notify the course coordinator by signing and submitting a group contribution statement (available on Canvas). The group contribution statement should be uploaded to Canvas as well together with their report and video presentation. The group member that has issues with the majority of his/her group will receive only partial or no credit as stated in the Declaration of Group Work Commitment.  Students can source data from EIKON for the assignment.

Penalties for late submission

All assignments will be marked as if submitted on time. Late submissions of assignments without special consideration or extension will be automatically penalised at a rate of 10% of the total marks available per day (or part of a day) late. For example, if an assignment is worth 20 marks and it is submitted 1 day late, a penalty of 10% or 2 marks will apply. This will be deducted from the assessed mark. Assignments will not be accepted if more than five days late, unless special consideration or an extension of time has been approved.

Rubric:

Rubric is available on Canvas.