Recently, Wal-Mart established two retail outlets in the city of Shenzhen, China, which has a population of 3.7 million. These outlets are massive and contain products purchased locally as well as imports. As Wal-Mart generates earnings beyond what it needs in Shenzhen, it may remit those earnings back to the United States. Wal-Mart is likely to build additional outlets in Shenzhen or in other cities in the future.

a. Explain how Wal-Mart might utilize the Eurocurrency market when it is establishing other Wal-Mart stores in Asia. b. Explain how Wal-Mart could use the Eurobond market to finance the establishment of new outlets in foreign markets.