Introduction to Finance & Economics - Mar 2010

By the end of week 1 you should understand the following:

Overview of interest rates
Prime rates / Libor
Overview of Foreign exchange markets.
Role of Central banks in an economy
 
Reading assignment:
 
http://en.wikipedia.org/wiki/Prime_rate
http://en.wikipedia.org/wiki/London_Interbank_Offered_Rate
http://www.traderji.com/forex/4386-forex-what-how-does-work.html
http://www.articlesbase.com/currency-trading-articles/how-does-forex-currency-trading-work-273831.html

Response to discussion questions must be posted by Tuesday 1200 GMT and at least 2 follow up postings  to a students post must be done by 1200 GMT Thursday.
 
1) Why do countries have currencies with different values to each other?
 2) How does a nation gain and / or  lose when the value of their currency fluctuates?
3) How can  government  actions (central banks) affect the value of their currency and why do they do so?
4) How does a currency trader make and lose money?

Hint: you may have to do some additional research. Please cite all your research. 

By the end of week 1 you must submit your business plan  proposal ( 1 paragraph) for approval. The business plan can be any good or service that involves some sort of cross border dealings. Think of a business plan you always wanted to explore further and add  to the idea a function that must involve dealing in a foreign country.  If you are stuck, please contact me.