Money & Banking (Mgt 411) Assignment Solution.

Semester “Spring 2010”

“Money & Banking (Mgt 411)”

Assignment No. 1 Marks: 20

Question 01

Part A

Calculate consumer price index and inflation rate by using following data. (Marks 4)

Years

Cost of Basket

CPI

Inflation rate

2006

2000

?

?

2007

2300

?

?

2008

2850

?

?

Part B

Calculate GDP deflator and inflation rate by using following data. (Marks 4)

Years

Nominal GDP

Real GDP

GDP deflator

Inflation rate

2006

78000

78000

?

?

2007

82000

80000

?

?

2008

89000

85000

?

?

Part C

Which of the following accounts will include in M1 & M2? Identify separately.

(Marks 2)

• Euro dollars

• Current account balances in Pakistan

• ATM cards balances in Pakistan

• Banks Saving accounts in Pakistan

• Individual money market mutual fund

• Institutional money market mutual fund share

Question 02

Part A

An investor deposits Rs.100,000 today in a bank and bank offers 5% interest rate per annum compounded quarterly. What will be the amount after 10 years? (Marks 5)

Part B

A student needs Rs 200,000 after 5 year for his study. What amount he has to deposit in a bank today so that he will have Rs 200,000 after 5 years if bank offers yearly 6% interest rate compounded semi-annually. (Marks 5)

Solution.

Semester “Spring 2010”

“Money & Banking (Mgt 411)” Assignment No. 1 Marks: 20

Question 01 Part A Calculate consumer price index and inflation rate by using following data. (Marks 4)

Solution.

Year	Cost of Basket	CPI	Inflation Rate
2006	2000	=2000/2000*100=100	n.a
2007	2300	=2300/2000*100=115	=115-100/100*100=15%
2008	2850	=2850/2000*100=142.5	=142.5-115/115*100=23.91%

Part B Calculate GDP deflator and inflation rate by using following data. (Marks 4)

Solution.

Years	Nominal GDP	Real GDP	GDP Deflator	Inflation Rate.
2006	78,000	78,000	=78000/78000*100=100	n.a
2007	82,000	80,000	=82000/80000*100=102.5	=102.5-100/100=2.5%
2008	89,000	85,000	=89000/85000*100=104.7	=104.7-102.5/102.5*100=2.15%

Part C Which of the following accounts will include in M1 & M2? Identify separately. (Marks 2) • Euro dollars • Current account balances in Pakistan • ATM cards balances in Pakistan • Banks Saving accounts in Pakistan • Individual money market mutual fund • Institutional money market mutual fund share

Solution.

M1:

· Euro dollars • Current account balances in Pakistan • ATM cards balances in Pakistan

M2:

· Banks Saving accounts in Pakistan • Individual money market mutual fund • Institutional money market mutual fund share

Question 02 Part A An investor deposits Rs.100,000 today in a bank and bank offers 5% interest rate per annum compounded quarterly. What will be the amount after 10 years? (Marks 5)

Given Data.

(Compounded Quarterly)

P.V=100,000

I=5%=5/100/4=0.0125%

n=10years=10*4= 40

FV=?

Formula>

F.V=P.V* (1+ i) ^n

=100,000*(1+0.0125) ^40

=100,000*1.6436

F.V=164,361ans

Part B A student needs Rs 200,000 after 5 year for his study. What amount he has to deposit in a bank today so that he will have Rs 200,000 after 5 years if bank offers yearly 6% interest rate compounded semi-annually. (Marks 5)

Given Data.

(Compounded semi-annually)

F.V=200,000

I=6%=5/100/2=0.03%

n=5years=5*2= 10

P.V=?

F.V=P.V* (1+ i) ^n

200,000=P.V*(1+0.03) ^10

P.V=200,000/1.3439

P.v=148,818.78ans.

MGT503 - Principles of Management #1 GDB

Q.How can scientific management, which provides managers with the capacity to analyze, predict, and control the behavior of the complex organizations, be applied in a world that is unpredictable, uncertain and even uncontrollable as today?

Solution.

It is true that the real world is unpredictable, uncertain and even uncontrollable over the time so it has effect an organization activities and policies, during this circumstances the organization is needed the plan to achieve the organizational goal, regarding this Frederick Winslow Taylor is introducing the scientific management method to analyze and evaluate the task from the every end and spread the each worker responsibility as per their specialization, these are the main factors of the scientific management to resolve the every problem and complete the task effectively.

Note.

Don't copy material it is just for making your mind how to attempt the question.

FIN622 - Corporate Finance GDB #1

Q.Why inflation premium and risk premium is added to real interest rate in order to arrive at value of nominal interest rate?

Solution.

Nominal Interest Rate

What Does Nominal Interest Rate Mean?
Nominal interest rates refer to referes to the rate of interest prior to taking inflation into account. Depending on its application, an inflation and risk premium must be added to the real interest rate in order to obtain the nominal rate.

Nominal Interest Rate

Nominal Interest Rate = Real Interest Rate + Inflation Premium + Risk Premium

In practice, the inflation premium is often assumed to be the expected inflation rate and the risk premium is ignored. Unless the economy is experiencing a deflationary period, the nominal rate will be higher than the real rate.

In The End lyrics

In The End lyrics
Songwriters: Bennington, Chester; Shinoda, Mike; Bourdon, Rob; Delson, Brad; Hahn, Joseph;

It starts with
One thing I don't know why
It doesn't even matter how hard you try
Keep that in mind I designed this rhyme
To explain in due time

All I know
Time is a valuable thing
Watch it fly by as the pendulum swings
Watch it count down to the end of the day
The clock ticks life away

It's so unreal
Didn't look out below
Watch the time go right out the window
Trying to hold on, but didn't even know
Or wasted it all just to watch you go

I kept everything inside
And even though I tried, it all fell apart
What it meant to me will eventually be
A memory of a time when

I tried so hard and got so far
But in the end it doesn't even matter
I had to fall to lose it all
But in the end it doesn't even matter

One thing, I don't know why
It doesn't even matter how hard you try
Keep that in mind I designed this rhyme
To remind myself how

I tried so hard
In spite of the way you were mocking me
Acting like I was part of your property
Remembering all the times you fought with me
I'm surprised

It got so far
Things aren't the way they were before
You wouldn't even recognize me anymore
Not that you knew me back then
But it all comes back to me in the end

You kept everything inside
And even though I tried, it all fell apart
What it meant to me will eventually be
A memory of a time when

I tried so hard and got so far
But in the end it doesn't even matter
I had to fall to lose it all
But in the end it doesn't even matter

I've put my trust in you
Pushed as far as I can go
And for all this
There's only one thing you should know

I've put my trust in you
Pushed as far as I can go
And for all this
There's only one thing you should know

I tried so hard and got so far
But in the end it doesn't even matter
I had to fall to lose it all
But in the end it doesn't even matter

Linkin Park-In The End (live)

Twenty20 Cricket World Cup 2010 Schedule

The ICC World Twenty20 2010 is a 20/20 cricket tournament scheduled to take place in West Indies in April-May 2010. It will be the third World Twenty20 cricket series. The ICC World Twenty20 2010 will be contested by 12 teams which have been ’seeded’ and divided into four groups are A, B, C and D.

Group A – Pakistan (A1), Bangladesh (A2) and Australia
Group B – Sri Lanka (B1), New Zealand (B2) and Zimbabwe
Group C – South Africa (C1), India (C2) and Qualifier 1
Group D – West Indies (D1), England (D2) and Qualifier 2

Date	Match	Time	Venue
Fri Apr 30	1st Match, Group D – West Indies v TBC	N/A	Providence Stadium, Guyana
Fri Apr 30	2nd Match, Group B – New Zealand v Sri Lanka	N/A	Providence Stadium, Guyana
Sat May 1	3rd Match, Group C – India v TBC	N/A	Beausejour Stadium, Gros Islet, St Lucia
Sat May 1	4th Match, Group A – Bangladesh v Pakistan	N/A	Beausejour Stadium, Gros Islet, St Lucia
Sat May 1	5th Match, Group D – England v TBC	N/A	Providence Stadium, Guyana
Sun May 2	6th Match, Group C – India v South Africa	N/A	Beausejour Stadium, Gros Islet, St Lucia
Sun May 2	7th Match, Group A – Australia v Pakistan	N/A	Beausejour Stadium, Gros Islet, St Lucia
Sun May 2	8th Match, Group B – New Zealand v Zimbabwe	N/A	Providence Stadium, Guyana
Mon May 3	10th Match, Group B – Sri Lanka v Zimbabwe	N/A	Providence Stadium, Guyana
Mon May 3	9th Match, Group D – West Indies v England	N/A	Providence Stadium, Guyana
Tue May 4	11th Match, Group C – South Africa v TBC	N/A	Kensington Oval, Bridgetown, Barbados
Tue May 4	12th Match, Group A – Australia v Bangladesh	N/A	Kensington Oval, Bridgetown, Barbados
Thu May 6	13th Match – TBC v TBC (A1 v D2)	N/A	Kensington Oval, Bridgetown, Barbados
Thu May 6	14th Match – TBC v TBC (C1 v B2)	N/A	Kensington Oval, Bridgetown, Barbados
Fri May 7	15th Match – TBC v TBC (A2 v C2)	N/A	Kensington Oval, Bridgetown, Barbados
Fri May 7	16th Match – TBC v TBC (B1 v D1)	N/A	Kensington Oval, Bridgetown, Barbados
Sat May 8	17th Match – TBC v TBC (C1 v D2)	N/A	Kensington Oval, Bridgetown, Barbados
Sat May 8	18th Match – TBC v TBC (A1 v B2)	N/A	Kensington Oval, Bridgetown, Barbados
Sun May 9	19th Match – TBC v TBC (C2 v D1)	N/A	Kensington Oval, Bridgetown, Barbados
Sun May 9	20th Match – TBC v TBC (B1 v A2)	N/A	Kensington Oval, Bridgetown, Barbados
Mon May 10	21st Match – TBC v TBC (B2 v D2)	N/A	Beausejour Stadium, Gros Islet, St Lucia
Mon May 10	22nd Match – TBC v TBC (A1 v C1)	N/A	Beausejour Stadium, Gros Islet, St Lucia
Tue May 11	23rd Match – TBC v TBC (B1 v C2)	N/A	Beausejour Stadium, Gros Islet, St Lucia
Tue May 11	24th Match – TBC v TBC (D1 v A2)	N/A	Beausejour Stadium, Gros Islet, St Lucia
Thu May 13	1st Semi-Final – TBC v TBC	N/A	Beausejour Stadium, Gros Islet, St Lucia
Fri May 14	2nd Semi-Final – TBC v TBC	N/A	Beausejour Stadium, Gros Islet, St Lucia
Sun May 16	Final – TBC v TBC	N/A	Kensington Oval, Bridgetown, Barbados