National and Global Finance Essay

1. Choose an example of a type of new company you could start, and thus use this company idea to answer the questions below. You might choose a pet store, a restaurant, a tutoring problem, or something else. This can be the analogous type of company you chose in assignment 8 or 9, or it can be different.a. answer for the type of business you chose. (1-2 sentences. 0.5 points) The type of business I would start would be for family or friends gatherings. This business would be office staff slew come to eat and social, a nice, warm evening. b. Describe at least(prenominal) twain ways in which the local, state, or federal regimen would have an impact on your business. (2-4 sentences. 1.0 points) Whether business owners know it or not, save the authorities create laws and regulation to protect the business. Two ways the g everywherenment would have an impact on my business is by hard-boiledting a price ceiling and price floor. These both determines whether or not my items it too high or low for its good.2. Describe at least whiz advantage and one disadvantage of price ceilings and price floors. Do you speak out price ceilings and floors are more helpful or more harmful to consumers and the economy? Explain. (2-4 sentences. 1.0 points) Price controls are the administration intervention in bare(a) markets. In the case of agriculture without price floors mass starvation could supervene as there is often a 2 to 10 social class turn around on agricultural investment. Price ceilings on sealed food products may also ease starvation. Remember that perfect openhanded markets have never existed except in theory.3. Describe at least both negative outcomes of having too little notes and credit in the economy. (2-4 sentences. 2.0 points) It would cause scarcity or cash, leading to rapid deflation, and also, overproduction of goods essence major markets would plummet in value. Overbalancing demand, leading to major losses for the producers.4. Describe at least two negative outcomes of having too much money and credit in the economy. (2-4 sentences. 2.0 points) It would cause a sacracity of currency, leading to rapid deflation. overproduction of goods means major markets would plummet in value, outbalancing demand, leading to major losses for the producers.5. Which Fed tool do you think is most important, andwhy? (2-4 sentences. 1.0 points) falsify the Federal Funds Rate via Open Market Transactions (buying and sell govt bonds on the open market). By far the most normally used tool. Whenever you read about the Fed changing the interest charge per unit they are referring to open market transactions & the Federal Funds Rate. Since they cannot set the pass judgment directly, but do it indirectly by buying and merchandising bonds on the open market, they usually refer to the desired interest rate as the target rate.6. Choose one of the following government agencies or laws FTC, EPA, FDA, CPSC, OSHA, FLSA, EEOC, ADA, SEC, or Affir mative Action. Search online to learn more about the bureau or law, and then describe three specific things the law or agency accomplishes. Make sure the information comes from a trustworthy website. entangle a link to the website in your answer. (3-6 sentences. 1.5 points) The EPA or Environmental Protection berth seeks to protect ordinary citizens from the devastation and destruction that may occur when people/companies are not held accountable for their actions environmentally. In most cases this agency has been truly effective and is used as a model all over the world to protect streams, rivers, air and people.7. Describe at least two products that are normally imported into the United States. (1-2 sentences. 0.5 points) Coffee (Brazil and Columbia) and Cotton T-shirts (Mexico, Honduras among a lot of opposites)8. Describe at least two products that are commonly exported from the United States to other(a) countries. (1-2 sentences. 0.5 points) Two of the largest American e xports are Oil author and Machines, engines, pumps, both to China for a combined total of 27.2 billion USD.9. wherefore does the U.S. government encourage U.S. companies to sell their products in other countries? Explain how this helps the U.S. (2-4 sentences. 2.0 points) The U.S. government encourages the U.S. companies to sell their products in other countries because other countries may offer bring out opportunities for growth.10. Find the value of one U.S. dollar in a hostile currency. You might choose the Euro, the Japanese Yen, the Canadian dollar, or another currency. add up the type of currency and the current value of the U.S. dollar in that country. (1.0 points) bill http//www.google.com/finance/converter is a good resource for inappropriate currency information. US 1 dollar = Jordanian 75cents11. Describe at least three sub rate factors that are likely to attractforeign investors to a countrys currency. Explain why these factors are hypnotic for foreign investors . (3-6 sentences. 3.0 points) OverviewBefore we look at these forces, we should sketch out how switch rate movements affect a nations trading relationships with other nations. A higher currency makes a countrys exports more expensive and imports cheaper in foreign markets a bring down currency makes a countrys exports cheaper and its imports more expensive in foreign markets. A higher supercede rate can be expected to lower the countrys balance of trade, while a lower diversify rate would increase it. Determinants of Exchange RatesNumerous factors determine exchange rate, and all are related to the trading relationship between two countries. Remember, exchange rates are relative, and are expressed as a comparison of the currencies of two countries. The following are some of the principal determinants of the exchange rate between two countries. Note that these factors are in no particular order like many aspects of economics, the relative importance of these factors is typeface to much debate. ConclusionThe exchange rate of the currency in which a portfolio holds the bulk of its investments determines that portfolios real return. A declining exchange rate plain decreases the purchasing power of income and capital gains derived from any returns. Moreover, the exchange rate influences other income factors such as interest rates, inflation and even capital gains from domestic securities. While exchange rates are determined by many complex factors that often leave even the most experienced economists flummoxed, investors should simmer down have some understanding of how currency values and exchange rates play an important role in the rate of return on their investments.