Question 1. Why might the IMF be called the "lender of last resort"? What are three of the tools they use for establishing economic stability in a country?
Question 2. Which is more conducive to international trade, the fixed or the floating exchange rate? Why?
Question 3. Choose one of the World Bank's present projects (from the website) and tell how it will benefit international trade.
Question 4. Country A has a stable currency and does substantial business with country B. The following is a history of recent exchange rates, given country A's rate is a constant 1:
Date Country B Exchange
April 1 240:1
May 1 255:1
June 1 310: 1
July 1 315: 1
What is happening here? How will a company in Country A purchase products from a company in Country B if it takes three months for the order to go through?
Question 5. Explain why and how a company would shift from Localization strategy to Transnational Strategy. Give an example even if you have to make it up.