Q+A: Does North Korea really want a fight?

SEOUL (Reuters) - The two Koreas exchanged artillery shots on Wednesday in a brief firefight that resulted in no damage but stoked tension on the peninsula.

Here are some questions and answers about the reasons behind North Korea''s tactics:

DOES IT WANT WAR OR PEACE?

North Korea wants a little of both. It is trying to signal it is ready to return to the stalled nuclear talks, but on terms set by Pyongyang. The threats against the South, a U.S. military ally that hosts about 28,000 U.S. troops, serve as a reminder to global powers to pay attention to its demands because the North has enough military might to wreck the region''s economy, which is equal to about one-sixth of the global economy. Wednesday''s artillery exchange may have been meant to underline the North''s insistence that a permanent peace accord is needed to replace the fraying truce that ended the 1950-53 Korean War.

WHAT WILL IT TAKE FOR NORTH KOREA RETURN TO NUCLEAR TALKS?

The United States and the other four countries in the long-running nuclear negotiations with the North will have to address Pyongyang''s demands for a peace deal, an end to U.N. sanctions imposed after its nuclear test in May 2009 and aid to prop up its broken economy.

Washington has said it will not bend, but analysts say it may allow a face-saving gesture such as raising the priority of the North''s demands in the six-country disarmament-for-aid talks if they resume.

WHY DOES NORTH KOREA KEEPING BRINGING UP A PEACE DEAL?

The heavily sanctioned state would be able to seek aid from global financial institutions including the World Bank by reaching a peace deal. It would also put pressure on Washington to meet the North''s long-standing demand to remove the U.S. troops from South Korean soil.

The North also hopes to delay any disarmament commitments it is required to make by saying peace talks must come first.

In the long run, North Korean leader Kim Jong-il''s military-first rule would probably be undermined by a peace deal.