writtingDIRECTIONS Choose two topics (total) for which you will conduct internet research. Be sure...

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writtingDIRECTIONS Choose two topics (total) for which you will conduct internet research. Be sure the choices come from two different chapters. For example, you may choose foreign direct investments from Chapter 1 and bid-ask spread from Chapter 7.  Conduct internet research that identifies at least 2 websites that discuss or involve the topic you have chosen. Include a last page for your website references and format them in APA style. Write a paragraph of at least 9 sentences summarizing what the website shows related to your topic. Be sure to supply citations in the paragraph ( in APA format) that refer to the websites you have found. Avoid using quotes as these will NOT count toward 9 sentences minimum. CHOICE THE TWO FOLLOWING TOPICS BELOW (MULTINATIONAL CORPORATION CHAPTER ONE) ( AND BANKER’S ACCEPTANCE CHAPTER EGHTEEN) 	CHAPTER ONE Arbitrage Foreign direct investment Globalization Multinational corporation Tax arbitrage TWO Currency depreciation Exchange rate  Freely Floating exchange rate Pegged currency FOUR Covered interest arbitrage Fisher Effect Interest Rate Parity International Fisher Effect Law of One Price Purchasing Power Parity Unbiased forward rate SEVEN Bid-ask spread CHIPS Cross rate currency arbitrage Direct quotation Forward contract Forward premium Hedgers Herstatt risk Indirect quotation Interbank market SWIFT Spot market Spot price 	EIGHT American option At-the-money Call option Currency future Currency option European option Exercise (strike) price Futures contract Initial margin In-the-money Maintenance margin Margin call Marking to market Out-of-the-money Put option EIGHTEEN Banker’s acceptance Bill of lading Cash in advance Commercial invoice Confirmed letter of credit Discounting  Draft Export credit insurance Factoring Forfaiting Irrevocable Letter of Credit Nonrecourse Open account sales Recourse Sight draft Time draft

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Bankers Acceptance
Whenever a bank gives guarantee or accepts any future payment on behalf of two persons then the bankers’ acceptance is created. It is basically a time draft which gives bank an order of paying a stated amount of money to the one holding the acceptance on the given date (Anderson, 2009).  Let us take an example of two companies one having business in X country and another in Y country. Zen Ltd. of X country sells mobile phones. So there is an order from Can Ltd. of Country Y to purchase Mobile phones worth $5 lakhs from Zen Ltd. Now Zen ltd wants to get paid as soon as there order is shipped but Can Ltd cannot pay at that time, so here the bankers’ acceptance will come into play as to fulfill the demand of Zen Ltd, Can ltd will go to the bank and will request the bank to issue letter of credit which is a document which ensures full payment to the seller on time. After the bank issues the letter of credit taking some collateral which will be the title on the purchased mobile phones, the letter of credit will be send to Zen Ltd. After the shipment of mobile phones Zen ltd bank can demand the amount from the bank of Can Ltd and the bank can record the amount as loan to Can Ltd or as an acceptance depending upon the level of capital of bank, its future lending opportunities etc. and Can Ltd will discharge its liability towards the bank within a stipulated time.
Merely an order issued by the importer to the bank for asking the bank to pay the exporter or the bearer of document a stated sum of money is not a bankers’ acceptance. It becomes an acceptance when an authorized bank signs the document and stamps it as ‘accepted’.

DIRECTIONS Choose two topics (total) for which you will conduct internet research. Be sure the choices come from two different chapters. For example, you may choose foreign direct investments from...

Answer To: DIRECTIONS Choose two topics (total) for which you will conduct internet research. Be sure the...

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