Answer the following questions regarding Exchange Rates and International Capital Flows.

a)Suppose a country has an overall balance of trade so that exports of goods and services equal imports of goods and services. Does that imply that the country has balanced trade with each of its trading partners?

b)What does it mean to hedge a financial transaction?

c)What does it mean to say that a currency appreciates? Depreciates? Becomes stronger? Becomes weaker?