Discuss exchange rates and their influence on international trade and capital flows.

Why do businesses pursue international expansion beyond their domestic markets?

What will happen to the trade balance and the real exchange rate of a small open economy when government purchases increase, such as during a war? Does your answer depend on whether this is a local war or a world war?

View the data on the trade balance below. Then answer the questions that follow. FRED Trade Balance: Goods and Services, Balance of Payments Basis -10,000 -20,000 -30,000 -40,000 -50,000 -60,000 -70,000 -80,000 -90,000 1995 2000 2005 2010 2015 2020 2000 Sources: U.S. Census Bureau; U.S. Bureau of Economic Analysis Customize | Download Data | FRED - Economic Data from the St. Louis Fed 1. Is the United States currently in a trade deficit or a trade surplus situation? 2. What is the most recent amount of deficit or surplus? 3. There's a time between July 2008 and February 2009 when the value of the trade deficit changed substantially. Did the trade deficit increase or decrease during this time? Millions of Dollars

China runs a huge balance of payments surplus with the U.S. Which country benefits in terms of living standards and why?

Discuss three factors that would impact the values of the major currencies in foreign exchange

How can a country fix its exchange rate to another? Is it sustainable for them to maintain it fixed?

Consider the appreciation of a currency. What effects might this have on international companies exporting overseas?  What actions could companies take to minimize these effects

Please explain how an increase in incomes in the United States will affect equilibrium in the foreign exchange market?

How does a trade deficit affect floating exchange rates?