Question 1 a. Some countries do not have well-established market for (ILOS: A1, A2, B1, C1, C2, D1, D4) debt securities or equity securities. Why do you think this can limit the development of the country, business expansion, and growth in national income in these countries? b. When economic crises in countries are due to a weak economy, local interest rates tend to be very low. However, if the crisis is caused by an unusually high rate of inflation, the interest rate tends to be very high. Explain why?

Question 1 a. Some countries do not have well-established market for (ILOS: A1, A2, B1, C1, C2, D1, D4) debt securities or equity securities. Why do you think this can limit the development of the country, business expansion, and growth in national income in these countries? b. When economic crises in countries are due to a weak economy, local interest rates tend to be very low. However, if the crisis is caused by an unusually high rate of inflation, the interest rate tends to be very high. Explain why?

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter6: Government Influence On Exchange Rates

Section: Chapter Questions

Problem 15QA

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