金融市场习题文档格式.docx

金融市场习题文档格式.docx

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Theinterestratethatequatesthepresentvalueofpaymentsreceivedfromacredit

marketinstrumentwithitsvaluetoday.

Optioncontracts:

Contractsthatgivethepurchasertheoptiontobuyorselltheunderlyingfinancial

instrumentataspecifiedprice,calledtheexercisepriceorstrikeprice,withinaspecificperiodoftime.

Capitalmarket:

Afinancialmarketinwhichlonger-termdebt（maturityofgreaterthanoneyear）and

equityinstrumentsaretraded.

Ifthereisadeclineininterestrates,whichwouldyouratherbeholding,long-termbondsorshort-term

bonds?

Why?

Whichtypeofbondhasthegreaterinterest-raterisk?

Youwouldratherbeholdinglong-termbondsbecausetheirpricewouldincreasemorethanthepriceofthe

short-termbonds,givingthemahigherreturn.

Whateffectwillasuddenincreaseinthevolatilityofgoldpriceshaveoninterestrates?

Interestrateswouldrise.Asuddenincreaseinpeople'

sexpectationsoffuturerealestatepricesraisesthe

expectedreturnonrealestaterelativetobonds,sothedemandforbondsfalls.ThedemandcurveBdshifts

totheleft,andtheequilibriuminterestraterises.

Whatcharacteristicsdefinethemoneymarkets?

Themoneymarketscanbecharacterizedas

havingsecuritiesthattradeinoneyearorless,

areof

largedenomination,andareveryliquid.

1.Whyarefinancemarketsimportanttothehealthoftheeconomy?

Becausetheychannelfundsfromthosewhodonothaveaproductiveuseforthemtothosewhodo,thereby

resultinginhighereconomicefficiency.

2.Wheninterestraterise,howmightbusinessesandconsumerschangetheireconomicbehavior?

Businesseswouldcutinvestmentspendingbecausethecostoffinancingthisspendingisnowhigher,and

consumerswouldbelesslikelytopurchaseahouseoracarbecausethecostoffinancingtheirpurchaseis

higher.

3.Howcanachangeininterestratesaffecttheprofitabilityoffinancialinstitutions?

Achangeininterestratesaffectsthecostofacquiringfundsforfinancialinstitutionsaswellaschangesthe

incomeonassetssuchasloans,bothofwhichaffectprofits.Inaddition,changesininterestratesaffectthe

priceofassetssuchasstockandbondsthatthefinancialinstitutionownswhichcanleadtoprofitsorlosses.

4.Iseverybodyworseoffwheninterestratesrise?

No.Peoplewhoborrowtopurchaseahouseoracarareworseoffbecauseitcoststhemmoretofinance

theirpurchase;

however,saversbenefitbecausetheycanearnhigherinterestratesontheirsavings.

5.Whateffectmightafallinstockpriceshaveonbusinessinvestment?

ssharesmeansthatitcanraiseasmalleramountoffunds,andsoinvestmentin

'

Thelowerpriceforafirm

plantandequipmentwillfall.

6.Whateffectmightariseinstockpriceshaveonconsumers'

decisionstospend?

Higherstockpricesmeanthatconsumers'

wealthishigherandsotheywillbemorelikelytoincreasetheir

spending.

7.HowdoesadeclineinthevalueofthepoundsterlingaffectBritishconsumers?

ItmakesforeigngoodsmoreexpensiveandsoBritishconsumerswillbuylessforeigngoodsandmore

domesticgoods.

8.HowdoesadeclineinthevalueofthepoundsterlingaffectAmericanbusinesses?

ItmakesBritishgoodsmoreexpensiverelativetoAmericangoods.Americabusinesseswillfinditeasierto

selltheirgoodsintheUnitedStatesandabroad,andthedemandfortheirproductswillrise.

9.Howcanchangesinforeignexchangeratesaffecttheprofitabilityoffinancialinstitutions?

Changesinforeignexchangerateschangethevalueofassetsheldbyfinancialandthusleadtogainsand

lossesontheseassets.Alsochangesinforeignexchangeratesaffecttheprofitsmadebytradersinforeign

exchangewhoworkforfinancialinstitutions.

10.LookingatFigure3.inwhatyearswouldyouhavechosentovisittheGrandCanyoninArizonarather

thantheTowerofLondon?

Inthemid-tolate1970sandthelate1980sandearly1990s,thevalueofthedollarwaslow,makingtravel

abroadrelativelymoreexpensive;

thatwouldhavebeenagoodtimetovacationintheUnitedStatesandsee

theGrandCanyon.Asthedollar'

svalueroseintheearly1980s,travelabroadbecamerelativelycheaper,

makingitagoodtimetovisittheTowerofLondon.

11.Whatisthebasicactivityofbanks?

Banksacceptdepositsandthenusetheresultingfundstomakeloans.

12.Whataretheotherimportantfinancialintermediariesintheeconomybesidesbanks?

Savingsandloanassociations,mutualsavingsbanks,creditunions,insurancecompanies,mutual

funds,pensionfunds,andfinancecompanies.

13.Canyou