Reference no: EM133123862

International Economics

1) Discuss the economic-integration project known as the European Union in its different stages. Briefly characterize why we have come to refer to the EU as "multi-speed Europe."

2) Discuss the key motives behind the foreign direct investment. Compare (statistically) the FDI of US corporations with those of foreign multinationals in the US. Why do many emerging-market economies welcome FDI by US multinationals in their economy?

3) Discuss the structure of the balance of payments in terms of its different accounts (and their respective sub-accounts)! What is the relationship between a country's balance of payments and its currency's exchange rates?

4) How is the US currently faring in terms of its balance of payments with the rest of the world? Why is the US not like any other debtor nation? In light of the US' special status in the world economy, is Trump correct in obsessing about our country's trade deficit and viewing it as the result of other countries taking advantage of America?

5) Discuss the global FOREX market, in terms of size, location, price formation, contract types, and activity categories.

6) Compare (by listing and assessing the pluses as well as the minuses) of flexible exchange rates versus fixed exchange rates! How do countries decide which exchange-rate regime to pursue?

7) Under what conditions (see Marshall-Lerner Condition) will a depreciation effectively help reduce a country's trade deficit? What is the J-curve and how does its presence in effect alter (or perhaps even undermine) this adjustment process?

8) When developing and emerging-market economies peg their currencies, what risks do they face to find themselves eventually in a currency crisis? What have they tried to do about this threat?