Theoretical Background and Simulation of the Carry Trade Strategy within CEE-States

Research question:
The main research question: "How does the carry trade strategy work?" is focused on a basic explanation of the carry trade strategy. This question is answered in chapter four including the risk and profitability of carry trades.
The sub-question is: "What is the theoretical background?" This question is focused in chapter two, chapter three and the beginning of chapter four. Chapter seven summarizes this paper and gives the answer if someone should invest money by using this strategy.