International Business Environment

 Answer both questions independently 1. Around 40 years ago, national capital markets functioned largely as independent markets. But since then, the amount of debt, equity, and currencies traded internationally has increased dramatically. This has led to a lower cost of capital for business but higher market volatility. Should these markets now be regulated globally? 2. Governments try to maintain the confidence of investors, business people, and consumers in their economies. Lost confidence causes companies to put off investing in new products and technologies, and to delay the hiring of additional employees. Interest rates and exchange rates play a large role in this confidence. Can central banks successfully influence these?