Describe the main characteristics of the capital and money markets, with particular reference to the instruments traded on these markets and the basic principles of valuation which are used to price these instruments

Q: The process of fixing the price of securities in the financial market is based on which of the…

A: Solution: A financial market is market where people trade financial securities and derivatives. This…

Q: Should the weights used to calculate the WACC be based on bookvalues, market values, or something…

A: The WACC might considers the weight of each element of a corporation's capital structure. The…

Q: Which of the following is NOT a purpose of valuing financial securities? a. Valuation is used to…

A: The term securities range from stocks and bonds to derivative contracts of various types such as…

Q: In the equities capital markets, participants play key roles to support primary and secondary…

A: Capital market plays a significant role in raising funds for corporations and functioning of the…

Q: What is the purpose of valuation in terms of financ

A: Introduction : In simple words, finance refers to gathering of money by one entity or individual…

Q: Describe what is meant by the virtualization of traditional trade finance instruments.

A: First of all we need to understand what is Trade Finance Instruments: It is a payment instrument and…

Q: Differentiate the roles of brokers and dealers in the capital market.

A: Capital market A capital market is a place where suppliers and borrowers exchange their funds to…

Q: Explain concepts such as time value of money, present value and discount rate, and explain how they…

A: Time value of money is a concept which says the value of money today is worth more than the value…

Q: Define the term ‘Capital Market’ and explain different forms of efficiencies by referring to the…

A: A market in which all relevant information of securities are reflected by its prices are called…

Q: capital market?

A: Introduction: Financial market is a market where buyers & sellers engage in the activity of…

Q: idered the driving forces of the derivatives market? Rank them in order of  importance and provide a…

A: Derivative market is one of the most necessary component of the stock market.

Q: Differentiate between each of the following pairs of terms. a. Money market and capital market b.…

A: Differentiation of different markets has been provided :

Q: What role do marketable securities play in current asset management?

A: Answer: The management of current assets has acquired a distinctive positive for marketable…

Q: Discuss how market interest rates are affected by borrowers’ need for capital,expected inflation,…

A: The market interest rates are subject to several customer-related variables, including capital…

Q: Discuss the following models in relation to purchasing power parity.

A: Comparative rates of inflation in different countries are the factors influencing the exchange rate.…

Q: oney market and capital market securities by giving appropriate examples.

A: Introduction : The money market as well as the capital market are the two most significant…

Q: Discuss the types of money market instruments, draw a flow chart

A: Money market instruments refer to those financial instruments or securities that provide their…

Q: Give the complete distinguishing features of a money market instrument. Explain.

A: Money market instrument : Money market instrument are those financial securities that have maturity…

Q: at is the difference among regular market, negotiated market, and cash market? please elaborate

A: Introduction : After an IPO, a corporation 's stocks are released on the secondary market, which is…

Q: How do money markets and capital markets differ? Identify the types of securities traded in money…

A: The Money market is a feature of the economy that offers short term investment option. A…

Q: Differentiate between the following types of markets: physical asset vs. financial markets, spot vs.…

A: Note : As per the guidelines, only first three parts will be answered.

Q: Asset pricing Models provide a logical basis for computing the risk premiums and determining the…

A: Capital Asset Pricing Model (CAPM) is tool used to calculate the systemic risk of a asset. CAPM…

Q: What is relationship between the returns on an asset and returns in the whole mark

A: A market portfolio is a theoretical concept that means a portfolio that consists of all the stocks…

Q: Trading in derivatives

A: Derivatives are the type of contracts that force the value of an underlying asset. These contracts…

Q: explain The Effectiveness of Technical Analysis in Stock, Bond, Gold, Currency, and Commodity…

A: The technical analysis is that analysis in which the trend of the price of the stock, gold, bond and…

Q: Please draw the Capital Market Line and the Security Market Line. Please write down their function…

A: CAPITAL MARKET LINE V/S SECURITY MARKET LINE…

Q: Define the following terms: primary market, secondary market, capital market, money market.

A: The primary market is the market under which the securities of the companies are created. In the…

Q: Whatinformation is developed in the Capital MarketLine analysis and then carried over and used…

A: Answer: Capital market line is the resulting linear equation is graphically represented by a Capital…

Q: What is the basic or essential function of the financial markets? Briefly explain how and in what…

A: Financial market is referred as the market, where the people used to trade the financial derivatives…

Q: Money market instruments are distinguished by what characteristics, if any, do they have?

A: The money market is a word that relates to the trading of relatively short-term debt securities.

Q: Market risk arises from the level or volatility of market prices of assets. It involves the exposure…

A: Market risk is the chance of suffering losses as a result of price changes that are unfavorable for…

Q: Describe financial instruments and investment derivatives,

A: Financial instrument: A financial instrument is a monetary agreement among two parties, which can be…

Q: What is the role of Market Practice in Riba?

A: Riba (Islamic banking) It is charging of interest on loan/deposits. It is also a charge of an…

Q: What are the distinguishing features of a money market instrument? Please answer in broad

A: The market where buyer and seller interact in order to buying and selling of short-term securities…

Q: Outline and discuss the fundamental technique of valuation for both stocks and bonds. What role does…

A: Stock valuation means calculating the value of stock. It is very important because it helps in…

Q: The commodities or assets that are traded in financial market are called

A: Financial market (FM) is a place where financial items like stock, bonds, and precious items are…

Q: What is the difference between trading securities and available for sale securities, and how are…

A: The financial instruments that are tradable and can be used to raise capital in private and public…

Q: Please describe how to account for market value and unrealized gains and losses for each of these…

A: Investment in the business which can be mainly classified as two types.  One is debt Investment and…