Demonstrate an awareness of the variety of financial instruments. Examine the role of the financial system in the economy and the rationale for financial intermediation.

Assignment Purposes/Learning Outcomes:

After completion of Assignment-1 students will be able to:

LO1.Demonstrate an awareness of the variety of financial instruments.

LO2. Examine the role of the financial system in the economy and the rationale for financial intermediation.

LO4.Compare and contrast the role of and function of organized financial markets and financial intermediaries

LO 5. Demonstrate the connection between interest rates and asset prices.

Assignment Questions

Students must use proper references to justify their assignment work.

The Assignment questions are as follows:

Suppose Lina wants to start her new business for producing organic products, but she has no money to start her business. Suggest her two different funding options and their functions. So Lina can get the funds easily to run her business.

Suppose you are interested in buying your dream Sports car after one year from now. You estimate that the car will cost $40,000. If your local bank pays 5 percent interest on savings deposits, how much money will you need to save in order to buy the car as planned?

Distinguish between primary markets and secondary markets with the help of suitable examples.

Explain the phrase with an example “a dollar today is worth more than a dollar tomorrow.”