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International Finance Chp 1-3 Essay

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Below is an essay on "International Finance Chp 1-3" from Anti Essays, your source for research papers, essays, and term paper examples.

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! Supply and Demand! ! Balance of Payments- current account, capital account and financial account.! ! CA! ! exports/outflows! ! imports/inflows ! net! !
trade! ! goods ! +500! ! ! ! - 800! ! ! -300! !

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Introduction to international finance ch. 2!

! services! +700! ! ! ! profits!! +800! ! ! ! Balance! ! ! ! ! ! Financial Capital Account! ! ! ! Ouflow! ! !
FDI! ! Stocks! Bonds!!

! ! !

- 500! ! -1000! ! ! ! ! !

+200! -200! -300!

! ! ! ! ! !

inflow! ! 50! 400! 400! 50! ! ! ! ! ! !

! ! ! ! !

net! -350! 300! 300! 50! +300!

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-400! ! -100! ! -100! ! !

! ! !

Capital! ! !

! What is the impact of a current account deficit on a country's currency?! ! Causes it to depreciate! ! Why doesn't the $ always depreciate as a result of its deficit?! !

0! ! !

! !

Because people buy treasuries thus reducing the amount of dollars in circulation limiting depreciation!

! What are some subtle trade restrictions? / Restrictions imposed by governments! !
taxes / tariffs on imports! quotas! exchange rates! subsidies! Security reason - allowing other countries to build military planes, etc.!

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Factors affecting international trade flows!

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Inflation ! Ius > Iuk buy more uk goods / CA Decreases!
National Income! US > UK --> import more / CA decreases! Gov't policies! !

! Exchange Rates! ! ! How can a floating exchange rate correct trade imbalance?! ! !

What is the impact of $ depreciation on the US balance of trade in the short run? in the long run?! If the dollar depreciates in the short run there is not gonna be much of a change because a lot of transactions are done before hand on contracts. In the long run at first there is decrease in CA with more deficit but over it balances out closer to zero. J-curve effect.!

! Factors that affect Foreign portfolio investment! ! !

Taxes on interest or dividends! ! higher interest rates attracts foreign investment! ! Interest rates! Exchange rates! ! !

! CH 3 History of...

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APA Citation

International Finance Chp 1-3. Anti Essays. Retrieved December 14, 2018, from the World Wide Web: http://parimatch-stavka7.com/free-essays/International-Finance-Chp-1-3-169357.html


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