What is the function of the foreign exchange market


I want the following answered in simple layman's terms. I do need thurough answers with links to specifics when available.

Problem 1: How do global companies protect themselves against foreign exchange risk and other financial risks?

Problem 2: How do U.S. multinational organizations finance their global operations?

Problem 3: What is the function of the foreign exchange market? Who are the market participants?

Problem 4: Why is it important for a global business to conduct a risk analysis? In a country risk analysis, which factors carry more weight than others? Does this hold true for all countries?

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International Economics: What is the function of the foreign exchange market
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