Although we stated that real assets constitute the true productive capacity of an economy, it is hard to conceive of a modern economy without well-developed financial markets and security types. How would the productive capacity of the U.S. economy be affected if there were no markets in which to trade financial assets?

How does climate change threaten financial stability?

Made sure you differentiate portfolio investments from FDI. Can we argue that a "A closed economy, however, is entirely self-sufficient", or if it is, at what costs?   An open economy is one that engages in international trade of goods, services, and financial assets. An open economy participates in a variety of trade activities with foreign nations. A country's market can be expanded in a way that a closed economy can never do. It buys shares, debentures, bonds, and other types of securities from foreign nations and sells them to countries abroad. Normal people of an open economy are free to travel and work wherever they wish in that economy's domestic boundaries. A closed economy, however, is entirely self-sufficient, which implies that neither imports nor exports ever leave the nation. The objective of a closed economy is to provide all domestic consumers' needs from inside its boundaries. It does not import goods or services from other nations or export goods or services to them.…

Which of the following is not true     Large Value Transfer System is an electronic, real time net settlement network     The Bank of Canada implements monetary policy by lending money at the prime rate     LVTS and ACSS are operated by the Canadian Payments Association     The market for settlement balances is where overnight interest rate is determined   Financial innovation has caused     banks to suffer declines in their cost advantages in acquiring funds, although it has not caused a decline in income advantages     banks to suffer a simultaneous decline of cost and income advantages     banks to suffer declines in their income advantages in acquiring funds, although it has not caused a decline in cost advantages     banks to achieve competitive advantages in both costs and income

In theory, the arbitrage opportunity does not exist. However, with the new technologies and increased globalization, could arbitrage opportunity exist in some new ways?

Do you think that a U.S. firm can experience political risk problems in its overseas projects because of the U.S. government?

If a U.S.-based MNC focused completely on exporting, then its valuation would likely be adversely affected if most currencies were expected to appreciate against the dollar over time. Group of answer choices True False

How currency fluctuations can impact the profitability of solar-powered vehicles' operations. Which financial tools and exchange instruments do you recommend this company uses to mitigate currency risk?

When nominal interest rates have hit the zero lower bound, can central banks affect the interest rates? Select one: OA. Yes: since the zero lower bound applies to nominal rates, not real rates, and it is real rates that are relevant for investment decisions. OB. No: once the zero lower bound is hit, central banks can no longer employ interest rates to stimulate economic activity. OC. Yes, but the mechanism by which central banks manipulate the interest rates that matter for spending must deviate from the banks' traditional method. OD. A and C.

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: Suppose you observe the following spot and forward exchange rates between the U.S. dollar ($) and the Canadian dollar (C$):   Spot Exchange Rate One-Year Forward Exchange Rate Canadian dollar (U.S. dollar/Canadian dollar) 0.8932 0.9133   The current one-year interest rate on U.S. Treasury securities is 8.03%. If interest rate parity holds, what is the expected yield on one-year Canadian…