factors that affect interest rates

Assignment 1: Financial Markets and Institutions, Part 1

Write a five to seven (5-7) page paper in which you:

1. Explore one (1) financial market and the types of transactions supported by it in

the U.S. and global economies. Determine how valuable these transactions are

to the overall U.S. and the global economies.

2. Evaluate all the factors that affect interest rates to determine the one that

appears to impact interest rates the most in todays economic climate. Support

your answer with evidence and examples.

3. Analyze the ease or difficulty of forecasting interest rate changes. Assess the

value the forecast provides.

4. Examine why the Federal Reserve was created. Then construct an argument

as to whether or not the Federal Reserves major roles are essential to the U.S.

economy.

5. Choose a recent monetary policy (adopted during the past twelve (12) months).

Analyze its current and future impact on the U.S. and global economies.

6. Imagine you are a financial manager. Develop a strategy for the use of bond

markets by either an investor or firm of your choice to meet a stated financial

objective of your choice for that investor or firm.

7. Use at least four (4) quality academic resources in this assignment. Note:

Wikipedia and other Websites do not qualify as academic resources.

The specific course learning outcomes associated with this assignment are:

Describe the various types of financial markets and the types of transactions

supported by each market in the U.S. and globally.

Analyze the factors that affect interest rates and forecast interest rate changes.

Explain the operation of the Federal Reserve and describe how monetary policy is

used in the U.S. and other countries to manage the economy.

Develop strategies for the use of bond markets by investors and firms to meet stated

financial objectives.

Use technology and information resources to research issues in financial markets

and institutions.

Write clearly and concisely about financial markets and institutions using proper

writing mechanics.

Grading for this assignment will be based on answer quality, logic / organization of the

paper, and language and writing skills, using the following rubric.

Questions

1. Explore one (1) financial market and the types of transactions supported by it in

the U.S. and global economies. Determine how valuable these transactions are to the

overall U.S. and the global economies.

Weight: 10%

2. Evaluate all the factors that affect interest rates to determine the one that appears

to impact interest rates the most in todays economic climate. Support your answer with

evidence and examples.

Weight: 10%

3. Analyze the ease or difficulty of forecasting interest rate changes. Assess the value

the forecast provides.

Weight: 15%

4. Examine why the Federal Reserve was created. Then, construct an argument as to

whether or not the Federal Reserves major roles are essential to the U.S. economy.

Weight: 15%

5. Analyze a current monetary policy’s (adopted in the past 12 months) current and

future impact on the U.S. and global economies.

Weight: 20%

6. Develop a strategy for the use of bond markets by either an investor or firm of your

choice to meet a stated financial objective of your choice for that investor or firm.

Weight: 15%

7. 4 references

Weight: 5%