Re: [ vuZs.net ] IDEA SOLUTION OF MGT411 2 GDB

Type of risk: (Interest rate risk)

Specify the reason for choosing this risk in Bullets/ Numbers form ?
• The bank has invested the in treasury bonds for two years maturity
at fix interest rate so return will be certain.
• The bank will reissue the certificate of deposits by which it will
be able to pay for the certificates of deposits issued in first year.
in this way it will reduce the liquidity risk.
You all may write some few reasons but also explain these ones in your own words

On Sun, Jun 12, 2011 at 7:47 AM, LOVE IS BLIND(¯`•¸•´¯)
<badermuneer786@gmail.com> wrote:
> On Sat, Jun 11, 2011 at 8:23 PM, mc100400462 Rabia Naz
> <mc100400462@vu.edu.pk> wrote:
>> plzzzzzzzzzzzzzzzzzzzzzzzzzzz snd .thanks
>>
>> On Sat, Jun 11, 2011 at 7:55 PM, mc100403793 Amina Nawaz
>> <mc100403793@vu.edu.pk> wrote:
>>>
>>> PLZ SOMEONE GIVE IDEA SOLUTION OF 2ND GDB OF MGT411
>>>
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>>
>>
>>
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>> bia@vu
>> MBA 2nd smes.
>> Lahore
>> bia_042@hotmail.com
>> mc100400462@vu.edu.pk
>>
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>
> Question
> Money Aggregate or money supply plays a crucial role in any economy,
> which not only
> counts the money supply at specific time period but also useful in
> taking different
> economic decisions. Definitions of different money aggregate are somehow loosely
> defined but all the economists differentiate and classify M1, M2 & M3
> on the single
> Accepted base.
> Give answer in keywords only:
> Q#1.What is the main characteristic that distinguishes the different money
> aggregate definitions?
> Solution:
> The main characteristic that distinguishes the different money
> aggregate definitions is
> Liquidity.
> 2. Which money aggregate definition is mostly used in economic
> decision around the
> world?
> Solution:
> M2 is used in economic decisions.
> 3. Justify answer given against part-b. (Provide only one reason)
> Solution:
> Economists use M2 when they want to quantify the amount of money in
> circulation and
> try to explain different economic monetary conditions. M2 is a key
> economic indicator
> used to forecast inflation.
>

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