Explain shortly the following
(a) Onshore-offshore interest differential i.e the different between onshore and offshore interest rates (define more explicity what this means and state how it can be used to consider the extent of intertemporal trade between countries.
(b) Double entry bookkeeping(or double entry accounting ) in the balance of payments, along with the definition, demonstrate it with the potential US balance of payments categories of NX(net export) balance on primary income, balance on secondary income, capital account, the net credit nonreserve financial account and OSB the negative of the official settlement balance and the scenario that a US firm exports candy bars to Italy receiving euro in return.
(c) country premium (i.e the part of the risk premium that is not the exchange risk premium)
(d) economic stability loss from joining an exchange rate (explain why the loss arises)