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Hbc2213:Financial Institutions Question Paper

Hbc2213:Financial Institutions 

Course:Bachelor Of Commerce

Institution: Meru University Of Science And Technology question papers

Exam Year:2012



QUESTION ONE (30 MARKS)
(a) Discuss the main roles of stock exchange in the economy. ( 10 Marks) (b) One of the affiliates of world bank is the International fiancé Corporation (IFC). Discuss the functions performed by IFC. ( 6 Marks) (c) One of the most important roles of the Central Bank of Kenya is to control money supply in the economy. Outline FIVE ways in which the Central Bank executes this role. ( 10 Marks) (d) Differentiate with examples between, markets and capital markets. ( 4 Marks)
QUESTION TWO (10 MARKS)
(a) Discuss the main reasons why money markets are not well developed in most developing countries like Kenya. ( 10 Marks) (b) Discuss the roles and giver examples of Insurance companies in Kenya. ( 10 Marks)
QUESTION THREE (10 MARKS)
(a) Discuss the factors influencing the working of exchange rates. ( 10 Marks) (b) Discuss FIVE types/forms of exchange rate systems. ( 10 marks)
QUESTION FOUR (10 MARKS)
(a) Define the following terms as used in the International Financial Markets; (i) Fixed interest rate issue (ii) Zero coupon bonds (iii) Option (iv) Swap (v) Common paper
( 10 Marks
(b) Explain the reasons why futures and option markets are not developed in Kenya. ( 10 Marks)
QUESTION FIVE (20 MARKS) (a) Explain the basic functions of financial markets in an economy. ( 10 Marks) (b) Explain the following terms as used in financial markets; (i) Broken (Stock) (ii) Investment bank (iii) Bull (iv) Bears (v) Stock Jobber ( 10 Marks)






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