Need help with this problem set with some basic international finance questions

Problem Set 1 (Due Thursday, Feb. 25) (100 points) 1. (20 points) Explain how each of the following transactions generates two entriesa credit and a debitin the American balance of payments accounts, and describe in what category of the balance of payments (i.e. which account) each entry would be classified. a. An American buys a share of German stock, paying by writing a check on an account with a Swiss bank. b. An American buys a share of German stock, paying the seller with a check on an American bank. c. The Korean government carries out an official foreign exchange intervention in which it uses dollars held in an American bank to buy Korean currency from its citizens. d. A tourist from Detroit buys a meal at a restaurant in Lyon, France. e. A U.S.-owned factory in Britain uses local earnings to buy additional machinery. 2. (10 points) Explain the difference between the two kinds of flows of capital abroad. 3. (20 points) Explain why NFI = NX. 4. (20 points) Describe and explain the long-run implications of the Feldstein-Horioka Hypothesis for the current account. 5. (30 points) EuroDisney, near Paris, conducts its operations in euros. However, assume that next year Disney plans to undertake a major expansion of Disney World in Orlando, and will need to utilize money from EuroDisney to help fund the project. Of course, the American project must be paid for in dollars. a. Explain what forex risk Disney faces in utilizing the European funds. b. Explain how, using derivatives, Disney could hedge the forex risk they face