Chapter 3, Problem 2IEE

Define each of the following terms: a. Multinational corporation b. Exchange rate; fixed exchange rate system; floating exchange rate c. Trade deficit; devaluation; revaluation d. Exchange rate risk; convertible currency; pegged exchange rate e. Interest rate parity; purchasing power parity f. Spot rate; forward exchange rate; discount on forward rate; premium on forward rate g. Repatriation of earnings; political risk h. Eurodollar; Eurobond; international bond; foreign bond i. The euro