Advantages of going global for U.S. banks include all but which one of the follow Greater opportunities to exploit economies of scale Diversification of earnings Low fixed costs involved in international expansion Greater sources of funds
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A: 1. A. Financial intermediation It is a process of channelizing of the funds between the lender with…
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A: A. diversify to the oversea markets
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Q: Explain the differences and similarities between Forward, Futures, and Options
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- global risk factors What are some examples of global risk factors? What factors are most prevalent in today’s market? How can one modify investment strategies to account for such risks? (at least 200 word)Concept Question 2.4 Suppose the federal government wishes to purchase goods and services valued at $200 billion today and finances these expenditures by raising taxes. According to some economists, this will lead to V level of national consumption a lower a higher1. Introduction to the loanable funds Market In a large open economy, what is the source of the demand for loanable funds? Net foreign investment Net foreign investment and investment Investment National saving and investment
- QUESTION 17 Using the equation S = I+ NCO we can say a. Savers can do two things with their funds, invest them domestically through NCO or in foreign markets via I b. Savers can do two things with their funds, invest them domestically through I or in foreign markets through NCO c. Savers have unlimited options for their money d. Investment and NCO must be equal QUESTION 18 As the Real Exchange Rate rises a. Foreign purchases become more expensive O b. People do not want to buy things from abroad O c. Foreign purchases become cheaper in the domestic currency O d. Net Capital Outflows may decreaseChapter 19 In the foreign exchange market, how does a change in expected future U.S. exchange rate affect the demand for dollars?4. Interest rate parity The rise of globalization is due to the many companies that have become multinational corporations for various reasons-for example, to access better technology, to enter new markets, to obtain more raw materials, to find funding resources, to minimize production costs, or to diversify business risk. This multimarket presence exposes companies to different kinds of risk as well-for example, political risk and exchange rate risk. The relationship between interest rates and exchange rates can be represented through the concept of interest rate parity. Consider the following: An American investor is considering investing $1,000 in default-free 90-day Japanese bonds that promise a 4% annual nominal return. • The spot exchange rate is ¥101.12 per dollar. • The 90-day forward exchange rate is 100.25 per dollar. The investor's annualized return on these bonds-if he or she can lock in the dollar return by selling the foreign currency in the forward market-will be…
- Use the Mundell-Fleming model with perfect capital mobility, for each economy, analyze why the effectiveness of monetary, fiscal, and trade policies depend on the exchange rate regime in place in a country.global finance 21. The _____ Era saw the rise of a growing schism between the industrialized and emerging market nations. 22. A ________is any restriction that limits or alters the rate or direction of capital movement into or out of a country. 23. An extreme problem that has emerged several times in international financial history is ______,one of the problems that capital control has designed to control. 25. The _________ i.e. the risk associated with the business line of the individual firm can be eliminated through portfolio diversification by investors.Question 3In boosting macro and micro level business as a result of Covid-19, the government of Ghana as part of the strategy to restore confidence in the economy is providing a Ghc 1 billion stimulus package. Discuss fours ways that the financial market can benefit from this package.
- The importance of international financial institutions for the growth of the economy around the world?Analyse whether competition in the financial and banking system is good for the global economyQuestion Which of the statements below is FALSE? A. Multinational capital budgeting is a straightforward application of the Net Present Value (NPV. model with one twist: we can do the analysis in either domestic currency or foreign currency. B. If we are using foreign currency for the NPV decision, all we have to do is restate all the foreign incremental cash flow in terms of future value and use the current exchange rate. C. In conducting a multinational NPV, one must be careful to avoid differences with rounding of exchange rates, discount rates, and cash flow to produce the exact same value. D. With the foreign currency approach in NPV analysis, if we know the appropriate discount rate in the home country and the expected inflation rates in the two countries, we can determine the appropriate foreign discount rate.