FIN 401 Saudi Electronic University Banks Management Worksheet

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Zhmmvr

Economics

FIN 401

Saudi electronic university

FIN

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College of Administrative and Financial Sciences Assignment-1 Course Name: Banks Management Student’s Name: Course Code: FIN-401 Student’s ID Number: Semester: IInd Semester CRN: Academic Year: 1441/1442 H For Instructor’s Use only Instructor’s Name: Dr Firoz Alam Students’ Grade: /5 Level of Marks: High/Middle/Low Instructions – PLEASE READ THEM CAREFULLY • The Assignment must be submitted on Blackboard (WORD format only) via allocated folder. • Assignments submitted through email will not be accepted. • Students are advised to make their work clear and well presented; marks may be reduced for poor presentation. This includes filling your information on the cover page. • Students must mention question number clearly in their answer. • Late submission will NOT be accepted. • Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions. • All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism). • Submissions without this cover page will NOT be accepted. Question: 1. a. How Does the Fed affect the Banking and Financial system through open market operations? Why is OMO the preferred tool for many central banks around the globe? Explain in detail. (Minimum 500 words). (2.5 Marks) b. The following statistics and estimates were compiled by Big Moon Bank regarding a proposed new branch office and the bank itself: Branch office expected return = 15% Standard deviation of branch return = 8% Existing bank’s expected return = 10% Standard deviation of existing bank’s return = 5% Branch asset value as a percentage of total bank assets = 16% Correlation of net cash flows for branch and bank as a whole = +0.48 What will happen to Big Moon’s total expected return and overall risk if the proposed new branch project is adopted? (2.5 Marks) Answer: 1. 2.
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Running head: BANKS MANAGEMENT

Banks Management
University
Student’s name
Course title
Professor’s name
Date

1

BANKS MANAGEMENT

2
TABLE OF CONTENT

QUESTION1………………………………………………………………………………………2
QUESTION2………………………………………………………………………………………4
Reference………………………………………………………………………...…..……………5


College of Administrative and Financial Sciences

Assignment-1

Course Name:Banks Management

Student’s Name:

Course Code:FIN-401

Student’s ID Number:

Semester: IInd Semester

CRN:
Academic Year: 1441/1442 H

For Instructor’s Use only
Instructor’s Name: Dr Firoz Alam
Students’ Grade: /5

Level of Marks: High/Middle/Low

Instructions – PLEASE READ THEM CAREFULLY
• The Assignment must be submitted on Blackboard (WORD format only) via
allocated folder.
• Assignments submitted through email will not be accepted.
• Students are advised to make their work clear and well presented; marks may be
reduced for poor presentation. This includes filling your information on the cover
page.
• Students must mention question number clearly in their answer.
• Late submission...


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