Problem
1. Why can a country's nominal interest rate never be negative? Why can a country's real interest rate indeed be negative? If a country has a negative real rate, do you think that this suggests that the country is not well integrated into world financial markets? Explain.
2. Because futures contracts are short-term, three-month contracts for fixed value, how can you use the futures market to hedge against longer-term risk for larger amounts of eurodollars?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.