Discuss the main advantages of floating exchange rates;
Discuss the main disadvantages of floating exchange rates.
Discuss the difference between a movement and a shift of the demand curve Private sector companies have multiple stakeholders who are likely to have divergent interests. Required:{a} Identify ve stakeholder groups and briefly discuss theirfinancial and other ob'lectives.lb]Examine the extent to which good corporate governance procedures can help manage the problems arising from the divergent interests of multiple stakeholder groups in private sector companies. l'v'linicorp is a mining company. Its mission is to 'maximise profits for shareholders whilst recognising its responsibilities to society'. Itis considering a mining opportunity abroad in a remote country area where there is widespread poverty. The mining work will destroy local vegetation and may pollute the immediate water supply for some yea rs to come. The company directors believe that permission for the mining worksl likely to be granted by the government as there are few people or animals living in the area and the company will be providing muchneeded jobs. Identify the likely stakeholders in the company's decision. Consider their possible objectives and describe three likely conflicts in those objectives. You are the investment manager of a unitised fund which holds a diversified portfolio covering all major asset categories. Equity markets have recently received a severe shock. There are concerns that your fund may experience a very high level of encashments and it has been suggested you should protect the fund by selling futures contracts. State the main comments you would make in reply to this suggestion. (4] A large pension fund holds a substantial diversified portfolio of US equities that is managed by a specialist manager. The manager's brief is to modestly outperform over rolling three-year periods relative to a benchmark index. The return on his portfolio for the latest twelve months was -20% as measured in US$ whilst the benchmark index fell 25%. The chairman of the trustees has written to you as the fund's investment advisor stating this return is a disaster and that the fund has lost a fortune. He argues the manager should be sacked immediately and a claim commenced against the manager for the loss the fund has suffered. Outline the main points you would make in your reply and identify what further information you would require. (5] (1) State the different characteristics of offices and residential properties. [4] A unitised fund invests in commercial properties. There are no derivative contracts available which are relevant to the properties in which the fund invests. (a) Explain the particular difficulties that large encashments cause such a fund. (b) State two alternative approaches this fund could take to manage large encashments and describe any adverse aspects associated with them
