Writing an Essay - Sample Writing

<h1>Writing an Essay - Sample Writing</h1><p>The most ideal approach to discover the perfect penmanship and language tests for your paper is to do a little schoolwork and investigate them. It doesn't take a lot, and once you've done some similar correlations, you'll have all that could possibly be needed example sentences to complete your essay.</p><p></p><p>If you're getting ready to compose an article on legislative issues, the examples you can utilize incorporate political examination, argumentation, quote assortment, and conversation. These all go together, as do sentence structure, grammar, style, and tone. Therefore, you need to be certain that you have however many example sentences as could be allowed that show your capacity to compose well.</p><p></p><p>If you are taking school level composition, you will most likely need to do some class assignments on governmental issues or other related subjects, and compos ing is a significant piece of this procedure. On the off chance that you don't have the foggiest idea how to organize your article and organization your content accurately, at that point the examples of language and writing in the exposition tests segment of an online interpretation administration won't be effective.</p><p></p><p>There are many, numerous schools that show legitimate strategies for sentence structure and language, and in case you're new to these things, the most ideal approach to learn is to stare at the TV or read as much as possible. You will likewise need to consider what your own composing resembles, and you should start by perusing your own work until you have a smart thought of how it streams and sounds.</p><p></p><p>If you are not at where you can take a gander at your own work and know whether it is the correct sort of composing for your article, there are numerous English language tests accessible from speciali st co-ops, which will give you a progressively adjusted comprehension of what the different styles mean and how to appropriately utilize them. Try not to stress a lot over how their content may sound to you, since you can discover numerous approaches to move toward them that will sound totally address to others.</p><p></p><p>Many understudies who do a great deal of research frequently search for the correct examples of composing as they compose their own work. This is valid for the vast majority, however you might have the option to profit by realizing that multiple occasions the individuals who don't pay attention to this sort of research don't succeed very well in the composing calling. So consider this on the off chance that you end up battling with syntax or style.</p><p></p><p>Even when you don't have your semantic abilities acceptable, you can even now utilize language tests to furnish you with a beginning stage for your composit ion. It's simply an issue of finding the correct example entries that you can use in your work, with the goal that you don't just duplicate glue words out of your PC's Word report, yet rather utilize a model sentence or expression from the punctuation and composing tests in an article that will enable your perusers to see precisely what you're attempting to communicate.</p>

Topic Ideas That Will Put Up a Good Fight

<h1>Topic Ideas That Will Put Up a Good Fight</h1><p>If you are going to compose an exposition on a specific subject, and in the event that you are wanting to compose a paper, at that point you should have a lot of theme thoughts. These are the subjects that will make a valiant effort with other all the more notable points. These are the points that will end up being a commendable enemy in the warmth of the day.</p><p></p><p>To settle on exposition themes, you can likewise go on the Internet and quest for the subject that you need to compose a paper on. Also, you can even peruse the web for a wide range of paper subjects. You ought to likewise look the Internet for the assessment of others. Ask your companions, neighbors, or family members and attempt to hear their point of view about the subject that you have in mind.</p><p></p><p>You can likewise utilize the Internet to peruse a few and can get a wide range of though ts from these. You can likewise look through these web journals and compose an exposition on any of these. In the event that you utilize the Internet for this, at that point you will clearly know which of these is going to make a valiant effort with the others. You will at that point have the option to list these themes that will make your paper a commendable rival in the most ideal manner. Thusly, you can be certain that the point that you are going to compose will be acceptable enough.</p><p></p><p>Now you have a couple of subjects that you can use as contentions to compose an exposition that will make a valiant effort with the others. These are the theme thoughts that will make a valiant effort in the day. These are the points that won't let you down. What's more, in the event that you go through these themes to put a decent battle, at that point you will get an opportunity to get all the focuses that you need to make in your essay.</p><p></ p><p>Now you would then be able to go out and discover subjects that will make a valiant effort in the day. For example, you can get any of the accompanying subjects for an exposition. These are the point thoughts that won't let you down. You can likewise attempt to peruse the online journals and read for these points that will make a valiant effort in the day.</p><p></p><p>For sure, you need to locate a decent theme to utilize. You should then assemble all the thoughts you have and this should then assist you with deciding the point that will be the best to utilize. On the off chance that you scan the web for the assessment of others, at that point you can discover great subjects that are to utilize. You can likewise make a rundown of the points that you can use.</p><p></p><p>So now you have a rundown of subjects that you can use as your exposition themes. What's more, these are the subjects that will make your article a comm endable adversary in the day.</p>

English Literature Essay Topics You May Not Have Noticed

English Literature Essay Topics You May Not Have NoticedWhile writing an English literature essay topics should never be omitted, you need to keep in mind the fact that English writing for students and adults has changed over the years. There are some topics that are outdated or simply don't apply to you and your needs now as a student.American history is one of the oldest subjects to be included in a literature essay. There is plenty of information available about the founding fathers and the country's past, however as a student it is a subject you should not touch. It is an age old subject that should not be used as the sole basis for your essay.Another of the English literature essay topics that many students take for granted is romance. It is an art form that has existed from the beginning of civilization. It is a multi-faceted subject that will leave you with lots of interesting facts to bring up and hopefully lead to an interesting topic. If you are unsure of the genre, use Wik ipedia and if you are a fan of the genre, read as many books as you can.The actual purpose of this topic is to find a topic that can be easily read by an English student. This topic can include anything from the history of the book to how it fits into the entire world. The topic must be relevant to the overall writing that you are doing. You want to make sure that you do not overwhelm your readers with too much information or they may become bored with your essay.A major and even most important thing to remember when writing an essay of this nature is to present yourself well. Since your audience is going to be primarily other English literature students, you need to be able to present yourself in a way that will appeal to them. The tone you use, the words you use, and your body language are all important things to consider.There are many different types of people who want to write essays on a topic like this, but it is best to know what the problem is before you try to present it. The goal is to make sure you are writing from a position of strength and not something that are too weak. This will ensure that your audience is left with something that is easily understood.As mentioned above, the common theme with this topic is romance. It is actually a very important topic for people who have a taste for this type of literature to have a grasp on. It is not too difficult to determine what kind of romance you are writing about, but it can also be challenging to write an essay that will hold a lot of appeal to everyone who reads it.As you can see, there are many English literature essay topics that can be used to help guide you along the way to successful writing. There are a few topics that you may be familiar with that have been used over the years and you may want to avoid, however if you research enough you will find that the basics are the ones that work best for you. Whether you are a beginner or a professional, keeping a list of the basic topics you may enco unter will help you when it comes time to research what you need to write.

Bank Management Chapter 7 Free Essays

string(202) " able to recapture its costs because its productivity has not increased commensurately or because the technology has already become obsolete, it has invested in a negative NPV investment in technology\." Suggested end-of-Chapter Practice Questions: Chapter Seven Chapter 71, 2, 3, 7, 11, 13, 19, 22, 29, 32, 33, problem similar to HW 1. What is the process of asset transformation performed by a financial institution? Why does this process often lead to the creation of interest rate risk? What is interest rate risk? Asset transformation by an FI involves purchasing primary assets and issuing secondary assets as a source of funds. The primary securities purchased by the FI often have maturity and liquidity characteristics that are different from the secondary securities issued by the FI. We will write a custom essay sample on Bank Management Chapter 7 or any similar topic only for you Order Now For example, a bank buys medium- to long-term bonds and makes medium-term loans with funds raised by issuing short-term deposits. Interest rate risk occurs because the prices and reinvestment income characteristics of long-term assets react differently to changes in market interest rates than the prices and interest expense characteristics of short-term deposits. Interest rate risk is the effect on prices (value) and interim cash flows (interest coupon payment) caused by changes in the level of interest rates during the life of the financial asset. . What is refinancing risk? How is refinancing risk part of interest rate risk? If an FI funds long-term fixed-rate assets with short-term liabilities, what will be the impact on earnings of an increase in the rate of interest? A decrease in the rate of interest? Refinancing risk is the uncertainty of the cost of a new source of funds that are being used to finance a long-term fixed-rate asset. This risk occurs when an FI is holding assets with maturities greater than the maturities of its liabilities. For example, if a bank has a ten-year fixed-rate loan funded by a 2-year time deposit, the bank faces a risk of borrowing new deposits, or refinancing, at a higher rate in two years. Thus, interest rate increases would reduce net interest income. The bank would benefit if the rates fall as the cost of renewing the deposits would decrease, while the earning rate on the assets would not change. In this case, net interest income would increase. 3. What is reinvestment risk? How is reinvestment risk part of interest rate risk? If an FI funds short-term assets with long-term liabilities, what will be the impact on earnings of a decrease in the rate of interest? An increase in the rate of interest? Reinvestment risk is the uncertainty of the earning rate on the redeployment of assets that have matured. This risk occurs when an FI holds assets with maturities that are less than the maturities of its liabilities. For example, if a bank has a two-year loan funded by a ten-year fixed-rate time deposit, the bank faces the risk that it might be forced to lend or reinvest the money at lower rates after two years, perhaps even below the deposit rates. Also, if the bank receives periodic cash flows, such as coupon payments from a bond or monthly payments on a loan, these periodic cash flows will also be reinvested at the new lower (or higher) interest rates. Besides the effect on the income statement, this reinvestment risk may cause the realized yields on the assets to differ from the a priori expected yields. 7. How does the policy of matching the maturities of assets and liabilities work (a) to minimize interest rate risk and (b) against the asset-transformation function for FIs? A policy of maturity matching will allow changes in market interest rates to have approximately the same effect on both interest income and interest expense. An increase in rates will tend to increase both income and expense, and a decrease in rates will tend to decrease both income and expense. The changes in income and expense may not be equal because of different cash flow characteristics of the assets and liabilities. The asset-transformation function of an FI involves investing short-term liabilities into long-term assets. Maturity matching clearly works against successful implementation of this process. 11. A money market mutual fund bought $1,000,000 of two-year Treasury notes six months ago. During this time, the value of the securities has increased, but for tax reasons the mutual fund wants to postpone any sale for two more months. What type of risk does the mutual fund face for the next two months? The mutual fund faces the risk of interest rates rising and the value of the securities falling. 13. What is market risk? How do the results of this risk surface in the operating performance of financial institutions? What actions can be taken by FI management to minimize the effects of this risk? Market risk is the risk of price changes that affects any firm that trades assets and liabilities. The risk can surface because of changes in interest rates, exchange rates, or any other prices of financial assets that are traded rather than held on the balance sheet. Market risk can be minimized by using appropriate hedging techniques such as futures, options, and swaps, and by implementing controls that limit the amount of exposure taken by market makers. 14. What is credit risk? Which types of FIs are more susceptible to this type of risk? Why? Credit risk is the possibility that promised cash flows may not occur or may only partially occur. FIs that lend money for long periods of time, whether as loans or by buying bonds, are more susceptible to this risk than those FIs that have short investment horizons. For example, life insurance companies and depository institutions generally must wait a longer time for returns to be realized than money market mutual funds and property-casualty insurance companies. 19. What is the difference between technology risk and operational risk? How does internationalizing the payments system among banks increase operational risk? Technology risk refers to the uncertainty surrounding the implementation of new technology in the operations of an FI. For example, if an FI spends millions on upgrading its computer systems but is not able to recapture its costs because its productivity has not increased commensurately or because the technology has already become obsolete, it has invested in a negative NPV investment in technology. You read "Bank Management Chapter 7" in category "Essay examples" Operational risk refers to the failure of the back-room support operations necessary to maintain the smooth functioning of the operation of FIs, including settlement, clearing, and other transaction-related activities. For example, computerized payment systems such as Fedwire, CHIPS, and SWIFT allow modern financial intermediaries to transfer funds, securities, and messages across the world in seconds of real time. This creates the opportunity to engage in global financial transactions over a short term in an extremely cost-efficient manner. However, the interdependence of such transactions also creates settlement risk. Typically, any given transaction leads to other transactions as funds and securities cross the globe. If there is either a transmittal failure or high-tech fraud affecting any one of the intermediate transactions, this could cause an unraveling of all subsequent transactions. 22. If you expect the French franc to depreciate in the near future, would a U. S. -based FI in Paris prefer to be net long or net short in its asset positions? Discuss. The U. S. FI would prefer to be net short (liabilities greater than assets) in its asset position. The depreciation of the franc relative to the dollar means that the U. S. FI would pay back the net liability position with fewer dollars. In other words, the decrease in the foreign assets in dollar value after conversion will be less than the decrease in the value of the foreign liabilities in dollar value after conversion. 29. What is country or sovereign risk? What remedy does an FI realistically have in the event of a collapsing country or currency? Country risk involves the interference of a foreign government in the transmission of funds transfer to repay a debt by a foreign borrower. A lender FI has very little recourse in this situation unless the FI is able to restructure the debt or demonstrate influence over the future supply of funds to the country in question. This influence likely would involve significant working relationships with the IMF and the World Bank. 32. What is liquidity risk? What routine operating factors allow FIs to deal with this risk in times of normal economic activity? What market reality can create severe financial difficulty for an FI in times of extreme liquidity crises? Liquidity risk is the uncertainty that an FI may need to obtain large amounts of cash to meet the withdrawals of depositors or other liability claimants. In times of normal economic activity, depository FIs meet cash withdrawals by accepting new deposits and borrowing funds in the short-term money markets. However, in times of harsh liquidity crises, the FI may need to sell assets at significant losses in order to generate cash quickly. 33. Why can insolvency risk be classified as a consequence or outcome of any or all of the other types of risks? Insolvency risk is the risk that an FI may not have enough capital to offset a sudden decline in the value of its assets. This risk involves the shortfall of capital in times when the operating performance of the institution generates accounting losses. These losses may be the result of one or more of interest rate, market, credit, liquidity, sovereign, foreign exchange, technological, and off-balance-sheet risks. 34. Discuss the interrelationships among the different sources of FI risk exposure. Why would the construction of an FI’s risk management model to measure and manage only one type of risk be incomplete? Measuring each source of FI risk exposure individually creates the false impression that they are independent of each other. For example, the interest rate risk exposure of an FI could be reduced by requiring customers to take on more interest rate risk exposure through the use of floating rate products. However, this reduction in FI risk may be obtained only at the possible expense of increased credit risk. That is, customers experiencing osses resulting from unanticipated interest rate changes may be forced into insolvency, thereby increasing the FI’s default risk. Similarly, off-balance sheet risk encompasses several risks since off-balance sheet contingent contracts typically have credit risk and interest rate risk as well as currency risk. Moreover, the failure of collection and payment systems may lead corporate customers into bankruptcy. Thus, te chnology risk may influence the credit risk of FIs. As a result of these interdependencies, FIs have focused on developing sophisticated models that attempt to measure all of the risks faced by the FI at any point in time. Practice 1. A bank has the following balance sheet structure: AssetsLiabilities and Equity Cash$10,000Certificate of Deposit$90,000 Bond$90,000Equity $10,000 Total Assets$100,000Total Liabilities and Equity$100,000 The bond is a Eurobond; it has a ten-year maturity and a fixed-rate coupon of 6 percent. The certificate of deposit has a one-year maturity and a 4 percent fixed rate of interest. The FI expects no additional asset growth. a. What will be the net interest income (NII) at the end of the first year? Note: Net interest income equals interest income minus interest expense. b. If at the end of year 1, market interest rates have increased 100 basis points (1 percent), what will be the net interest income for the second year? Is the change in NII caused by reinvestment risk or refinancing risk? c. Assuming that market interest rates increase 1 percent. (i) What will be the market value of the bond? (ii) What will be the market value of equity? (Assume that all of the NII in part (a) is used to cover operating expenses or is distributed as dividends, so that there is no addition to retained earnings. ) a. What will be the net interest income (NII) at the end of the first year? Note: Net interest income equals interest income minus interest expense. Interest income$5,400$90,000 x 0. 06 Interest expense 3,600$90,000 x 0. 04 Net interest income (NII)$1,800 b. If at the end of year 1, market interest rates have increased 100 basis points (1 percent), what will be the net interest income for the second year? Interest income$5,400$90,000 x 0. 06 Interest expense 4,500$90,000 x 0. 05 Net interest income (NII)$900 The decrease in net interest income is caused by the increase in financing cost without a corresponding increase in the earnings rate. The increase in market interest rates does not affect the interest income because the bond has a fixed-rate coupon for ten years. Note: this answer makes no assumption about reinvesting the first year’s interest income at the new higher rate. c. Assuming that market interest rates increase 1 percent. (i) What will be the market value of the bond? (ii) What will be the market value of equity? (Assume that all of the NII in part (a) is used to cover operating expenses or is distributed as dividends, so that there is no addition to retained earnings. Note: market value of equity falls due to lower market value of the bond If the coupon rate is 6%, yield to maturity = 7%, then using our financial calculator, N = 9 (only 9 years left), PMT = 540, I = 7%, FV = 90,000. Compute PV; find PV = -84,136. 29. Hence the market value of the bond fell from $90,000 to $84,136. 29 (a decrease of $5,863. 71). Since the interest rate on the CD has risen (it had only a one year maturity; so it get s a new interest rate when it is re-issued), the market value of the CD is $90,000 (interest rate = coupon rate on the CD). Consequently, it is the market value of equity that will decline. If the bank must sell the bond, it will sell it at the lower market value and realize the loss. The book value of equity has remained at #10,000, but the market value of equity has fallen by the amount of the decrease in the value of the bonds. This was a problem faced by banks in 2008, when the market value of the mortgage debt and mortgage backed securities and CDOs (collateralized debt obligations) fell; some of them had negative equity in market value terms. How to cite Bank Management Chapter 7, Essay examples

Bank Management Chapter 7 Free Essays

string(202) " able to recapture its costs because its productivity has not increased commensurately or because the technology has already become obsolete, it has invested in a negative NPV investment in technology\." Suggested end-of-Chapter Practice Questions: Chapter Seven Chapter 71, 2, 3, 7, 11, 13, 19, 22, 29, 32, 33, problem similar to HW 1. What is the process of asset transformation performed by a financial institution? Why does this process often lead to the creation of interest rate risk? What is interest rate risk? Asset transformation by an FI involves purchasing primary assets and issuing secondary assets as a source of funds. The primary securities purchased by the FI often have maturity and liquidity characteristics that are different from the secondary securities issued by the FI. We will write a custom essay sample on Bank Management Chapter 7 or any similar topic only for you Order Now For example, a bank buys medium- to long-term bonds and makes medium-term loans with funds raised by issuing short-term deposits. Interest rate risk occurs because the prices and reinvestment income characteristics of long-term assets react differently to changes in market interest rates than the prices and interest expense characteristics of short-term deposits. Interest rate risk is the effect on prices (value) and interim cash flows (interest coupon payment) caused by changes in the level of interest rates during the life of the financial asset. . What is refinancing risk? How is refinancing risk part of interest rate risk? If an FI funds long-term fixed-rate assets with short-term liabilities, what will be the impact on earnings of an increase in the rate of interest? A decrease in the rate of interest? Refinancing risk is the uncertainty of the cost of a new source of funds that are being used to finance a long-term fixed-rate asset. This risk occurs when an FI is holding assets with maturities greater than the maturities of its liabilities. For example, if a bank has a ten-year fixed-rate loan funded by a 2-year time deposit, the bank faces a risk of borrowing new deposits, or refinancing, at a higher rate in two years. Thus, interest rate increases would reduce net interest income. The bank would benefit if the rates fall as the cost of renewing the deposits would decrease, while the earning rate on the assets would not change. In this case, net interest income would increase. 3. What is reinvestment risk? How is reinvestment risk part of interest rate risk? If an FI funds short-term assets with long-term liabilities, what will be the impact on earnings of a decrease in the rate of interest? An increase in the rate of interest? Reinvestment risk is the uncertainty of the earning rate on the redeployment of assets that have matured. This risk occurs when an FI holds assets with maturities that are less than the maturities of its liabilities. For example, if a bank has a two-year loan funded by a ten-year fixed-rate time deposit, the bank faces the risk that it might be forced to lend or reinvest the money at lower rates after two years, perhaps even below the deposit rates. Also, if the bank receives periodic cash flows, such as coupon payments from a bond or monthly payments on a loan, these periodic cash flows will also be reinvested at the new lower (or higher) interest rates. Besides the effect on the income statement, this reinvestment risk may cause the realized yields on the assets to differ from the a priori expected yields. 7. How does the policy of matching the maturities of assets and liabilities work (a) to minimize interest rate risk and (b) against the asset-transformation function for FIs? A policy of maturity matching will allow changes in market interest rates to have approximately the same effect on both interest income and interest expense. An increase in rates will tend to increase both income and expense, and a decrease in rates will tend to decrease both income and expense. The changes in income and expense may not be equal because of different cash flow characteristics of the assets and liabilities. The asset-transformation function of an FI involves investing short-term liabilities into long-term assets. Maturity matching clearly works against successful implementation of this process. 11. A money market mutual fund bought $1,000,000 of two-year Treasury notes six months ago. During this time, the value of the securities has increased, but for tax reasons the mutual fund wants to postpone any sale for two more months. What type of risk does the mutual fund face for the next two months? The mutual fund faces the risk of interest rates rising and the value of the securities falling. 13. What is market risk? How do the results of this risk surface in the operating performance of financial institutions? What actions can be taken by FI management to minimize the effects of this risk? Market risk is the risk of price changes that affects any firm that trades assets and liabilities. The risk can surface because of changes in interest rates, exchange rates, or any other prices of financial assets that are traded rather than held on the balance sheet. Market risk can be minimized by using appropriate hedging techniques such as futures, options, and swaps, and by implementing controls that limit the amount of exposure taken by market makers. 14. What is credit risk? Which types of FIs are more susceptible to this type of risk? Why? Credit risk is the possibility that promised cash flows may not occur or may only partially occur. FIs that lend money for long periods of time, whether as loans or by buying bonds, are more susceptible to this risk than those FIs that have short investment horizons. For example, life insurance companies and depository institutions generally must wait a longer time for returns to be realized than money market mutual funds and property-casualty insurance companies. 19. What is the difference between technology risk and operational risk? How does internationalizing the payments system among banks increase operational risk? Technology risk refers to the uncertainty surrounding the implementation of new technology in the operations of an FI. For example, if an FI spends millions on upgrading its computer systems but is not able to recapture its costs because its productivity has not increased commensurately or because the technology has already become obsolete, it has invested in a negative NPV investment in technology. You read "Bank Management Chapter 7" in category "Essay examples" Operational risk refers to the failure of the back-room support operations necessary to maintain the smooth functioning of the operation of FIs, including settlement, clearing, and other transaction-related activities. For example, computerized payment systems such as Fedwire, CHIPS, and SWIFT allow modern financial intermediaries to transfer funds, securities, and messages across the world in seconds of real time. This creates the opportunity to engage in global financial transactions over a short term in an extremely cost-efficient manner. However, the interdependence of such transactions also creates settlement risk. Typically, any given transaction leads to other transactions as funds and securities cross the globe. If there is either a transmittal failure or high-tech fraud affecting any one of the intermediate transactions, this could cause an unraveling of all subsequent transactions. 22. If you expect the French franc to depreciate in the near future, would a U. S. -based FI in Paris prefer to be net long or net short in its asset positions? Discuss. The U. S. FI would prefer to be net short (liabilities greater than assets) in its asset position. The depreciation of the franc relative to the dollar means that the U. S. FI would pay back the net liability position with fewer dollars. In other words, the decrease in the foreign assets in dollar value after conversion will be less than the decrease in the value of the foreign liabilities in dollar value after conversion. 29. What is country or sovereign risk? What remedy does an FI realistically have in the event of a collapsing country or currency? Country risk involves the interference of a foreign government in the transmission of funds transfer to repay a debt by a foreign borrower. A lender FI has very little recourse in this situation unless the FI is able to restructure the debt or demonstrate influence over the future supply of funds to the country in question. This influence likely would involve significant working relationships with the IMF and the World Bank. 32. What is liquidity risk? What routine operating factors allow FIs to deal with this risk in times of normal economic activity? What market reality can create severe financial difficulty for an FI in times of extreme liquidity crises? Liquidity risk is the uncertainty that an FI may need to obtain large amounts of cash to meet the withdrawals of depositors or other liability claimants. In times of normal economic activity, depository FIs meet cash withdrawals by accepting new deposits and borrowing funds in the short-term money markets. However, in times of harsh liquidity crises, the FI may need to sell assets at significant losses in order to generate cash quickly. 33. Why can insolvency risk be classified as a consequence or outcome of any or all of the other types of risks? Insolvency risk is the risk that an FI may not have enough capital to offset a sudden decline in the value of its assets. This risk involves the shortfall of capital in times when the operating performance of the institution generates accounting losses. These losses may be the result of one or more of interest rate, market, credit, liquidity, sovereign, foreign exchange, technological, and off-balance-sheet risks. 34. Discuss the interrelationships among the different sources of FI risk exposure. Why would the construction of an FI’s risk management model to measure and manage only one type of risk be incomplete? Measuring each source of FI risk exposure individually creates the false impression that they are independent of each other. For example, the interest rate risk exposure of an FI could be reduced by requiring customers to take on more interest rate risk exposure through the use of floating rate products. However, this reduction in FI risk may be obtained only at the possible expense of increased credit risk. That is, customers experiencing osses resulting from unanticipated interest rate changes may be forced into insolvency, thereby increasing the FI’s default risk. Similarly, off-balance sheet risk encompasses several risks since off-balance sheet contingent contracts typically have credit risk and interest rate risk as well as currency risk. Moreover, the failure of collection and payment systems may lead corporate customers into bankruptcy. Thus, te chnology risk may influence the credit risk of FIs. As a result of these interdependencies, FIs have focused on developing sophisticated models that attempt to measure all of the risks faced by the FI at any point in time. Practice 1. A bank has the following balance sheet structure: AssetsLiabilities and Equity Cash$10,000Certificate of Deposit$90,000 Bond$90,000Equity $10,000 Total Assets$100,000Total Liabilities and Equity$100,000 The bond is a Eurobond; it has a ten-year maturity and a fixed-rate coupon of 6 percent. The certificate of deposit has a one-year maturity and a 4 percent fixed rate of interest. The FI expects no additional asset growth. a. What will be the net interest income (NII) at the end of the first year? Note: Net interest income equals interest income minus interest expense. b. If at the end of year 1, market interest rates have increased 100 basis points (1 percent), what will be the net interest income for the second year? Is the change in NII caused by reinvestment risk or refinancing risk? c. Assuming that market interest rates increase 1 percent. (i) What will be the market value of the bond? (ii) What will be the market value of equity? (Assume that all of the NII in part (a) is used to cover operating expenses or is distributed as dividends, so that there is no addition to retained earnings. ) a. What will be the net interest income (NII) at the end of the first year? Note: Net interest income equals interest income minus interest expense. Interest income$5,400$90,000 x 0. 06 Interest expense 3,600$90,000 x 0. 04 Net interest income (NII)$1,800 b. If at the end of year 1, market interest rates have increased 100 basis points (1 percent), what will be the net interest income for the second year? Interest income$5,400$90,000 x 0. 06 Interest expense 4,500$90,000 x 0. 05 Net interest income (NII)$900 The decrease in net interest income is caused by the increase in financing cost without a corresponding increase in the earnings rate. The increase in market interest rates does not affect the interest income because the bond has a fixed-rate coupon for ten years. Note: this answer makes no assumption about reinvesting the first year’s interest income at the new higher rate. c. Assuming that market interest rates increase 1 percent. (i) What will be the market value of the bond? (ii) What will be the market value of equity? (Assume that all of the NII in part (a) is used to cover operating expenses or is distributed as dividends, so that there is no addition to retained earnings. Note: market value of equity falls due to lower market value of the bond If the coupon rate is 6%, yield to maturity = 7%, then using our financial calculator, N = 9 (only 9 years left), PMT = 540, I = 7%, FV = 90,000. Compute PV; find PV = -84,136. 29. Hence the market value of the bond fell from $90,000 to $84,136. 29 (a decrease of $5,863. 71). Since the interest rate on the CD has risen (it had only a one year maturity; so it get s a new interest rate when it is re-issued), the market value of the CD is $90,000 (interest rate = coupon rate on the CD). Consequently, it is the market value of equity that will decline. If the bank must sell the bond, it will sell it at the lower market value and realize the loss. The book value of equity has remained at #10,000, but the market value of equity has fallen by the amount of the decrease in the value of the bonds. This was a problem faced by banks in 2008, when the market value of the mortgage debt and mortgage backed securities and CDOs (collateralized debt obligations) fell; some of them had negative equity in market value terms. How to cite Bank Management Chapter 7, Essay examples

Maker Movement Spreads Innovation Project †Myassignmenthelp.Com

Question: Discuss About The Maker Movement Spreads Innovation Project? Answer: Introduction The video is all about the maker movement, where the craftsmen transform their imagination into reality. It is really surprising that the machines used for hacking the computers are used for revolutionizing the technology of the whole world. Here, contrast can be developed between the hacking and revolutionizing the technology. The main theme of the video is design thinking and creative learning, which possesses flexibility to create corporate minds for the production of innovative products and services (Youtube.com, 2017). Along with this, the aspect of design thinking is also applicable in altering the scenario of the workplace of business, education and healthcare (Schn, Ebner Kumar, 2014). The technology used The technologies shown in the video are drillers, leathers, screw drivers, screw pens, meter boxes among others. Variety of these technologies helps the craftsmen to produce latest and innovative machines for enhancing the comfort of the people (Halverson Sheridan, 2014). The quotation, being a maker is just not taking the world is effective in terms of makers relation with the world. Innovation in the design of the crafts enhances his social identity. (Source: Halverson Sheridan, 2014) Perceiving the maker movement as a hobby reflects the importance of craftsmanship in terms of the other professions (Youtube.com, 2017). Here, manufacturing attains commonality in terms of luring the people towards the technology. The quotation, I made this and I think there is something really negative about that is a kind of looking down upon the efforts put in by the manufacturers for creating modern and innovative technology. Impact and implications on the contemporary culture The technology projected in the video is enhances the clarity of the spectators in terms of the widespread benefits of technology in the fields of education, healthcare and finance. Technology has eased each and every activity; rather it has transformed the scenario of the administration (Peppler Bender, 2013). (Soure: Peppler Bender, 2013) The end of the work day reflects the end of the manufacturing tasks, which the manufacturers perform within their shift timings. It is the enthusiasm, which helps them to perform the challenging tasks in an efficient and effective manner. Looking at the pile and boasting that much of the work is done has several connotations. One, this boasting reflects the satisfaction of the manufacturer in terms of capability towards performing the allocated tasks. On the other hand, it contradicts the essential characteristics of the manufacturers in terms of achieving customer satisfaction (Dougherty, 2012). Delving deep into both these connotations, both relate with the approach of the manufacturer regarding the allocated duties and responsibilities. Negative impression about the produced work reflects the lack of confidence regarding the effective functioning of the machine. This negativity is a threat for the workplace, school, hospitals and other places in terms of carrying out the tasks automatically. If the drawbacks are not modified within proper time, the machines would turn out to be defective at the time of the actual operation (Schn et al., 2014). On the contrary, if IT experts are hired for examining the machines, it would be beneficial for the professionals of various walks of life to enhance the productivity. Conscious attitude towards this activity helps in maintaining the balance of life. Herein lays the appropriate correlation with the phrase, ecosystem is in full phase. (Soure: Schn, Ebner Kumar, 2014) References Dougherty, D. (2012). The maker movement.innovations,7(3), 11-14. Halverson, E. R., Sheridan, K. (2014). The maker movement in education.Harvard Educational Review,84(4), 495-504. Peppler, K., Bender, S. (2013). Maker movement spreads innovation one project at a time.Phi Delta Kappan,95(3), 22-27. Schn, S., Ebner, M., Kumar, S. (2014). The Maker Movement. Implications of new digital gadgets, fabrication tools and spaces for creative learning and teaching.eLearning Papers,39, 14-25. Youtube.com (2017), Doumentary on Maker Movement, Retrieved 15th Sep 2017 from https://www.youtube.com/watch?v=mklywR7TQxs