Upon successful completion of this module, students will be able to:
Guidance and Preparation Note:
1. Overall word limit, excluding tables, charts, and graphs, is between 3000-4000 words.
1. Each question should be answered with close reference to key published academic literature and relevant financial data and evidence.
2.For Q.1(b) you need (1) to review carefully key academic literature and relevant published empirical evidence on EMH relating to your chosen stock exchange market, and (2) to carry out your own financial data analysis based on a relevant graphical analysis of the movements in daily share prices/ or relevant all- share price index ,over say a 90- days period, to arrive at a conclusion.
Answer all questions and all parts.
a. Distinguish between different levels of market efficiency. Give examples to illustrate your answer. (10 marks)
b. With close reference to the efficient market hypothesis literature and by using relevant empirical evidence and financial data, critically assess the” efficiency” of an emerging stock exchange market of your own choice. (30 marks)
Compare and contrast key role and functions of the capital markets with those of the money markets .Critically explain how money markets’ activities might influence asset prices in the capital markets. Give examples to illustrate your answer.
(a) Explain the nature of potential risks in international transactions and critically discuss how international traders might manage such risks via forward foreign exchange markets.
(b) Distinguish between the spot and the forward foreign exchange rates and examines the nature of the relationship between these two rates.
Explain what you understand by each one of the following terms:
a. Asymmetric information
b. Moral hazard
c. Adverse selection
Give examples to illustrate your answer.
With close reference to these terms, critically discuss why there is a need for regulating financial markets.Order Now