Hbc2105:Financial Institutions And Marketing Question Paper
Hbc2105:Financial Institutions And Marketing
Course:Bachelor Of Commerce
Institution: Meru University Of Science And Technology question papers
Exam Year:2011
QUESTION ONE
a) Explain the characteristic of emerging financial market giving examples where applicable. (10 Marks) b) Differentiate competitive from non-competitive biddery as used in CBK, auctions or treasury Bills. (2 Marks) c) Discuss the role that financial institutions and markets play in the economy to facilitate funds flow in the financial system. (8 Marks) d) Discuss the reason for financial liberalization in Kenya. (6 Marks) e) Comment on the statement forward rate are good predictors of future rate. (4 Marks)
QUESTION TWO (20 MARKS)
a) Explain why money market securities generally offer more protection against various investments risks than the capital markets instruments. ( 10 Marks) b) Clearly distinguish between the following terms as used in an financial system. (i) Treasury bills and treasury bonds. (2 Marks) (ii) Commercial paper and certificate of deposit. (2 Marks) (iii) Publicily held and closed held stock (2 Marks) (iv) Mutual funds and pension funds (2 Marks) (v) Future market and over the counter markets. (2 Marks)
QUESTION THREE (20 MARKS)
a) Discuss the factors that influence the level of prices for securities traded at the Nairobi Stock exchange. (10 Marks) b) The central bank of Kenya has directed some effort to the modernization of the payment system in the last two decade. Discuss the benefits that will be achieved by fully operatonalizing all recently implemented cheque transactions systems in Kenya. (10 Marks)
QUESTION FOUR (20 MARKS)
a) Discuss the challenges facing management of insurance schemes and provident funds in Kenya. ( 10 Marks) b) Discuss the importance of secondary markets in an economy. (10 Marks)
QUESTION FIVE (20 MARKS)
a) Explain what is meant by the term structure of interest rates and describe briefly the major theories that explain how interest rate are determined. (10 Marks) b) Discuss the benefits of central depository system (CDS) (10 Marks)
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