Homework CH 2-6
1. Balance of Payments.
a. What is the current account generally composed of?
ANSWER: The current account balance is composed of (1) the balance of trade, (2) the net
amount of payments of interest to foreign investors and from f
FNCE 4400- Homework 3
Motives for DFI. Describe some potential benefits to an MNC as a result of direct foreign
investment (DFI). Elaborate on each type of benefit. Which motives for DFI do you think encouraged
Nike to expan
FNCE440 Practice Final Exam
International banks are different from domestic banks in what way(s)?
a) International banks can arrange trade nancing
b) International banks can arrange for foreign exchange transactions.
0) International banks can assist th
On January 4, 1999, 11 member states of the European Union initiated the European Monetary
Union (EMU) and established a single currency, the euro, which replaced the individual
currencies of participating member states.
Locational Arbitrage. Assume the following information:
Bid price of New Zealand dollar $.401 $.398
Ask price of New Zealand dollar $.404 $.400
Given this information, is locational arbitrage possible? If so,