abridge金融市场学双语 郭宁 思考题整理 ZUCC

2021年1月20日发(作者：choker)
Chapter 1
3.

Some economists suspect that one of the reasons that economies in developing countries grow
so slowly is that they do not have well-developed financial markets. Does this argument make
sense?
Financial markets are crucial to promoting greater economic efficiency by channeling funds from
people who do not have a productive use for them to those who do. Well-functioning financial markets
are a key factor in producing high economic growth, and poorly performing financial markets are one
reason that many countries in the world remain poor.

Chapter 2
3.

Why are financial intermediaries so important to an economy?
Because the intermediary obtains funds from savers then makes loans/investments with borrowers. This
process, called financial intermediation, is actually the primary means of moving funds from lenders to
borrowers. More important source of finance than securities
markets Needed because of transactions
costs, risk sharing, and asymmetric information .

4.
Discuss
the
differences
between
depository
institutions,
contractual
savings
institutions,
and
investment intermediaries.

Depository
institutions
are
financial
intermediaries
that
accept
deposits
from
individuals
and
institutions and make loans.

Contractual saving institutions are financial intermediaries that acquire funds at periodic intervals on a
contractual basis.

Investment intermediaries are finance companies, mutual funds, and money market mutual funds that
provide transactionary services.


Chapter 11
3.

Explain how the Federal Reserve can influence the federal funds interest rate.
The Federal Reserve cannot directly control fed funds rates. It can and does indirectly influence them
by adjusting the level of reserves available to banks in the system. The Fed can increase the amount of
money in the financial system by buying securities. when investors sell securities to the Fed, the
proceeds are deposited in their banks' accounts at the Federal Reserve. These deposits increase the
supply of reserves by selling securities, fed funds rates will increase.
4.

Explain why money market interest rates move so closely together over time.
Because all of comparing money market securities have very low risk and a short term. They all have
deep markets and so are priced competitively. In addition , because these instruments have so many of
the same risk and term characteristics, they are close substitutes.
5.

How are Treasury bills sold? How do competitive and noncompetitive bids differ?
The Fed has set up a direct purchase option that individuals may use to purchase Treasury bills over the
Internet.

The significant difference between the two methods is that competitive bidders may or may
not end up buying securities whereas the noncompetitive bidders are guaranteed to do so.

Chapter 12
3.

What role do restrictive covenants play in bond markets?
The restrictive covenants include rules and restrictions on managers designed to protect the bondholders’
interest. And they usually limit the amount of dividends the firm can pay, and the ability of the firm to
issue additional debt.
4.

What is a convertible bond? How does the convertibility feature affect the bond's price and
interest rate?
Convertible bond is a kind of bond which bondholders can convert into a company's common stock at
the agreed price.

Result from the convertibility feature ,its price will be relatively higher and interest
rate will be comparatively lower.
5.

What types of risks should bondholders be aware of and how do these affect bond prices and
yields?
(1) Interest-rate risk. The longer the time until the bond matures, the greater will be the change in price.
If the bondholders attempt to sell their bonds after interest rates have risen, they will receive less than
they paid.
(2)Default risk. The degree of risk varies widely among different bond issues .Bonds with lower risk
and a higher rating have lower interest rates than more risk bonds.
(3) Liquidity risk. Bonds with shorter term and lower face value have lower interest rates.

Chapter 13
3.

How do over-the-counter markets differ from organized exchanges?
Organized exchanges :
1) Auction markets with floor specialists.
2) 25% of traders are filled with directly by specialist.
3) Remaining trades are filled through SuperDOT.
Over-the-counter markets:
1) Multiple market makers set bid and ask prices.
2) Multiple dealers for any given security.
4.

What are the advantages and disadvantages of Electronic Communications Networks (ECNs)
for trading stocks?
Advantages:
1
）
Transparency: everyone can see unfilled orders.
2
）
Cost reduction: smaller spreads.
3)

Faster execution
4
）
After-hours trading
Disadvantage: they work only for stocks with substantial volume.
5.

Why would a crisis in the subprime mortgage market lead to declining prices in the U.S. equity
markets?
The subprime financial crisis had a major negative impact on the economy leading to a downward
revision of the growth prospects for U.S. companies, thus lowering the dividend growth rate in the
Gordon model.

Chapter 14
3. What features contribute to keeping long
-
term mortgage interest rate low?

current long
-
term market rates;

the term of the mortgage;

the number of discount points paid

4. Explain the features of mortgage loans that are designed to reduce the likelihood of default.

a. Collateral : The lending institution will place a lien against the property, and this remains in effect
until loan is paid off.

b. Down payments: The lender requires the borrower to make a down payment on the property, that is ,
to pay a portion of the purchase price.

c. Private Mortgage Insurance: PMI is an insurance policy that guarantees to make up any discrepancy