Economic analysis is generally viewed as an integral part of the top-down approach to security analysis. In this context, identify each of the following and note how each would probably behave in a strong economy .Interest rates Industrial production Retail sales
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Economic analysis is generally viewed as an integral part of the top-down approach to security analysis. In this context, identify each of the following and note how each would probably behave in a strong economy
- .Interest rates
- Industrial production
- Retail sales
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- What strategies do you expect to see from a counterparty while negotiating? How will you prepare to meet those strategies?Which of the following would be an example of the government providing economic security? When someone is laid off from work, they can receive compensation from the government for a short time until they are able to find a new job. The government gives out money to everyone who asks for it. If someone loses their job, they will likely lose their house or go hungry, unless they have a large savings account. Everyone has housing provided by the government.Explain the necessary and sufficient conditions that must be met for security markets to operate efficiently
- Provide a real-world example of "Adverse Selection" in a business or financial transaction.An closest example of a risk-free security isIn the US in 2008, several large banks collapsed when risky financial investments began to fail. Describe this situation in context of systemic risk, and why the bailouts provided create the potential for future moral hazard.
- Name the four methods of payment for international shipments. Which method is riskiest for the buyer? For the seller?Which of the below is NOT a current characteristic of a cryptocurrency? A) The decentralization involves only two parties in the transaction, i.e., the sender and receiver. There is no third party such as a bank or an investment company to monitor the investor's actions. The blockchain technology will manage the database that has the bitcoin transaction records. B) Cryptocurrencies permit low cost trading and offer anonymity. C)The best part of using cryptocurrency is that every transaction you carry out with the recipient would be unique. You can get into terms negotiation in every deal. D) Cryptocurrencies are relatively low-risk-low return investments suitable for people with fixed incomes since they have fairly stable and predictable values.How do information asymmetries affect financing decisions?
- Foreign currency denominated transaction creates a transaction exposure for the company. Adverse movements in exchange rates between the transaction time and the settlement time can either reduce the cash inflows or increase the cash outflows for a firm. As such, protective measures need to be developed to counteract the transaction exposure. In line with the above, discuss the various strategies which firms can use to minimize their transaction exposure.What is an economic bubble? A product of illegal asset trading. Assets that are worthless. The start of a recession. An asset price that has risen above the level justified by economic fundamentals.Which of the following is NOT usually a short-term discount security? Bank bills overnight cash Negotiable certificates of deposit Commercial paper