Variation in the price of agricultural and non-agricultural commodities is determined over time, by demand-supply dynamics. The last two decades have seen a significant increase in the volume of international trade and business due to globalisation and liberalisation sweeping across the world. This has led to rapid and unpredictable variations in financial assets prices, interest rates and exchange rates, and subsequently, to exposing Multi-National Corporations to financial risk. As a result, financial markets have experienced rapid variations in interest and exchange rates and stock market prices, thus exposing the corporate world to a state of growing financial risk. We can hedge the risk of price variations in stocks, bonds, commodities, currencies, interest rates, market indices etc. Given this context please conduct the necessary research and answer the following questions.

1)How is a country's economic well-being enhanced through free international trade in goods and services? Provide and discuss two relevant examples specific to your jurisdiction.(10marks)

2)Outline and discuss two methods of payments in international trade and two (2 ) methods of financing international trade for a selected Multi National Corporation in your jurisdiction(8 marks)

3)Define and discuss two (2) similarities and two (2) differences between a futures contract and a forward contract. When would the use of one be preferred over the other?(12 marks)

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1 Enhancement of Economic Wellbeing through Free International Trade Free international trade in goods and services enhances a countrys economic wellbeing in several ways a Increased Market Access Fre... View the full answer