finance 40

1″Monetary Policy” Please respond to the following:

 

A. Determine the most significant monetary policy that the Federal Reserve Bank has been responsible for implementing in the past 12 months and the resulting impact to the U.S. economy. 

 

B.Analyze how U.S. monetary policy affects the global economy. Cite at least two examples with your answer.

 

 

2″Money Markets “ Please respond to the following:

 

A. Of the money market securities described in Chapter 6, determine which you believe is a safer investment for investors and firms in today’s economic environment. Support your response with evidence or an example. 

 

B. Determine when the money market would be a wise fit for the average investor.   

 

NOTE: Below is MONEY MARKET SECURITIES MENTION IN CHAPTER 6

 

1.treasury bill (T-bills)

2. commercial paper

3. negotiable certificates of deposit

4. repurchase agreements

5. federal funds

6. banker’s acceptances

3.during the credit crisis, the fed use a stimulative monetary policy. why do you think the total amount of loans to households and business did not increase

 

4.when the fed increases the money supply to lower the federal funds rate, will the cost of capital to U.S. companies be reduced? explain how the segment markets theory regarding the term structure of interest rates could influence the degree to which the fed’s monetary policy affects long-term interest rates.

 

5″Bond Markets” Please respond to the following:

·                                 From the first e-Activity, analyze how the Federal Reserve’s decision to keep interest rates low through late-2014 affects the bond market and determine if you are in agreement with this strategy. 

·                                 Describe the relationship between the bond rate and inflation. Then, apply this relationship to advise a small-business owner who wants to start a pension fund for his / her employees. (Students are to provide their own details about the type of small business and employees of that business.) 

 

note: here is the e-activities mention in question 5

e-Activities

·                                 Go to the MSN Money Website to read the news transcript titled “ Investing lessons from the 1950s,” dated February 21, 2012, located at http://money.msn.com/mutual-fund/investing-lessons-from-the-1950s-wsj.aspx. Be prepared to discuss. 

·                                 Research the Internet or the Strayer Library to compare and contrast fixed and adjustable rate mortgages to determine the best choice for you in today’s economic climate of either purchasing or refinancing a home. Be prepared to discuss.

 

 

6.”Bond Valuation and Risk” Please respond to the following:

·                                 Recommend a bond strategy for risk-tolerant and risk-adverse investors. Describe the key factors you considered when preparing the strategy. 

·                                 Discuss a strategy to incorporate international bonds in your portfolio. If you don’t already have a portfolio, pretend you are about to start one.