Over the last decade, the Egyptian economy suffer from sever collapse due to several reasons such as; January revaluation, Covid-19 pandemic. As a result, the Egyptian BOP is negatively affected and the Egyptian Economy suffer from sever financial disaster. To solve and mitigate the impact of this financial collapse and reform the Egyptian economy, the Egyptian Government decide to borrow fund from the IMF. To provide this borrowed fund to the Egyptian Government, the IMF imposed some conditions on the Egyptian Government such as reducing the provided subsidies and increase the level of the national reserve. Therefore, the Egyptian Government decides to switch the Foreign Exchange regime from the managed floating regime to free floating regime. 

Required a. Critically discuss the extent to which you agree with the decision of the Egyptian decision to switch from a managed float exchange rate regime to a floating exchange rate regime. And analyze the potential economic implications and impact of this decision on the short, medium, and long term. (3 marks)

 b. As a financial expert, critically discuss how the Egyptian Economy could be recovered and how they can correct the deficit of BOP with clarifying the obstacles of the international trade and the economic reforming in Egypt. (3marks) 

Question (2)- 

During the global financial disaster, numerous banks collapsed, and private citizens lost much money. And in recent years, a free-wheeling international banking industry has brought about a number of advantages. Soft limitations on global financial flows allowed businesses to obtain low-cost capital. Additionally, the unrestricted flow of finance gave governments access to crucial funding. As portfolio investments, inbound capital flows are extremely beneficial to nations. Required

 a. Critically discuss how the legislators can effectively manage and control the flow of capital. (3 marks) 

b. Critically analyse the extent to which new regulations could be needed in the global banking system to avoid any of financial crisis and how it could develop the international Trade volume? At the beginning of 2000, 27 European Union (EU) countries have adopted the euro as their national currency and are termed the Eurozone. Accordingly, the European countries have uniform their economic and political regulations and standards. Euro currency sharing to operate as a single and an internal market that allows free movement of goods, capital, services. Using of this single currency among the European countries eliminates exchange fluctuations. Eurozone firms had to make numerous operational changes, especially regarding finance and accounting, but generally prefer dealing in the euro. The European Central Bank (ECB) views the Eurozone as one region and must apply the same monetary policy to all EU members. But, the UK decided not to join the monetary union, keeping the British pound as its currency. 

Required 

a. Critically discuss the extent to which you agree with the construction of European Union with clarifying the changes did firms make when the euro became the new currency. (2marks) b. Critically discuss to what extent adopting the euro was worth for adopting countries, with clarifying how this union affect the international trade volume. (3 marks) 

c. Critically discuss to what extent you agree with the decision of The United Kingdom to not adopt the monetary union and continued to use the pound. (2 marks)

 d. After the global financial crisis, specifically In 2016, UK decided to withdraw from the EU (Brexit). Critically discuss your opinion in Brexit decision. (3 marks) 

Question (4)-  Foreign exchange arbitrage is the strategy of taking advantage of price differences in the foreign exchange markets. It can be accomplished in a variety of ways, but the arbitrage seeks to buy and sell currencies that are currently opposing but are extremely likely to rapidly congregate. As prices return to the mean, the arbitrage will become increasingly profitable and close, often in milliseconds. Arbitrage participants collectively contribute to the market becoming more efficient. All types of arbitrage rely on unusual market conditions being present at the time. Furthermore, all multinational corporations and financial institutions heavily rely on arbitrage in the foreign exchange market to profit from the Ubnormal returns trading mechanism.

 Required

 a. Critically analyze how the arbitrage of foreign exchange currencies could affect the efficiency of the foreign exchange market. 

 b. Critically analyze the market forces that could eliminate any further possibilities arbitrage opportunities.

 c. critically discuss how the changes in interest rate could affect the exchange rate and how arbitrage could affect the core of the equilibrium state of the relationship between interest rate and exchange rate. 

 Question (5)-

MTN is a telecommunications company, while IHS is a tower-building company. Tower sharing is becoming increasingly popular in Africa. A mobile network's coverage is what makes telecommunications companies money, and in this case, in 2014, the two companies decided to collaborate, and $500 million is committed for tower upgrades to ensure profit for both partners. 

Required a critically analyse the type of this international business cooperation with clarifying the competitive advantages and disadvantages of this cooperation. 

b. critically analyse the impact of this cooperation on BOP.

Answer rating: 100% (QA)

Question 1a Switching from Managed Float to Floating Exchange Rate Regime I agree with the decision of the Egyptian government to switch from a managed float exchange rate regime to a floating exchang... View the full answer