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Question Description

DIRECTIONS

Step 1:

Choose two topics, each from a different chapter.

Step 2:Conduct an internet research that illustrates or involves the topics you have chosen. You should have at least 2 websites for each topic. Format your references in APA style as required in the Web Exercise assignment.

Step 3: Write a paragraph summarizing what you have found for each of the two topics. Each paragraph should be a minimum of 7 complete sentences.

CHAPTER ONE

Arbitrage

Foreign direct investment

Globalization

Multinational corporation

Tax arbitrage

TWO

Currency depreciation

Exchange rate

Freely Floating exchange rate

Pegged currency

FOUR

Covered interest arbitrage

Fisher Effect

Interest Rate Parity

International Fisher Effect

Law of One Price

Purchasing Power Parity

Unbiased forward rate

SEVEN

Bid-ask spread

CHIPS

Cross rate currency arbitrage

Direct quotation

Forward contract

Forward premium

Hedgers

Herstatt risk

Indirect quotation

Interbank market

SWIFT

Spot market

Spot price

EIGHT

American option

At-the-money

Call option

Currency future

Currency option

European option

Exercise (strike) price

Futures contract

Initial margin

In-the-money

Maintenance margin

Margin call

Marking to market

Out-of-the-money

Put option

EIGHTEEN

Banker’s acceptance

Bill of lading

Cash in advance

Commercial invoice

Confirmed letter of credit

Discounting

Draft

Export credit insurance

Factoring

Forfaiting

Irrevocable Letter of Credit

Nonrecourse

Open

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