• Problem I: MNEs, as well as governments, rely on the IMS and the IMF in particular. Explain the importance of the role of the IMF in the IMS.
• Problem II: The IMF classifies exchange rates as being either a hard peg, a soft peg, floating or residual. Using either the IMF reading for Topic 2, or any other source, identify one country that has an exchange rate that falls within each of these four classifications
• Problem III: Foreign exchange rate regimes and the extent of capital mobility are typically related, and both have evolved over time. Explain what is meant by capital mobility and capital controls, and the implications capital controls have for MNEs.