Once capital markets are integrated, it is difficult for a country to maintain a fixed exchange rate. Why? O a. The market forces may be stronger than the exchange rate intervention that the government can muster. O b. Portfolio managers will not invest in countries with fixed exchange rates. c. Both a and b are correct. O d. None of the above.

Leads are deliberate early payments of amounts due to be paid in foreign currency to overseassuppliers, or other foreign currency payments. Leads can avoid the risk that the sterling cost of these payments may rise if the amountsof the payments are quoted in foreign currency and the foreign currencyincreases in value. Under what circumstances can how an international company can use ‘leads and lags’ to protect itself againstforeign exchange risk?

What is the effect on a country’s economy of an artificially lowexchange rate? Of an artificially high exchange rate?

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.…