Family Name SUBJECT CODE FIN 958 First Name Subject Name: Financial Markets Autumn 2021 Midterm Examination Time Allowed: 2 Hours Student Total Number of Questions: 4 Number.... Total Number of Pages (incl. this page): 2 1. Answer all questions. Each question carries equal 25 marks. 2. Answers must be written and drawn) in word document and Table Number the word limit is 5000 words. Your answers should be clear and concise. Include all relevant information, but only relevant information. 3. Total marks: 100. This Exam is worth 30% of your final marks for FIN958. INSTRUCTIONS TO STUDENTS (FURTHER TO INSTRUCTIONS POSTED ON MOODLE SITE). Download the provided Answer Booklet and start typing your answers in the Answer Booklet (word document). Keep saving your work on your desktop regularly. a. a. b. If your answer requires a diagram or calculation that cannot be created in the word document, use A4 size paper(s) to capture the diagram or calculation. Take a photo or scan of the paper (s), upload to your computer and attach with the Answer Booklet word document in order to form one single file that has to be uploaded. C. Upload the answer booklet as one file in Turnitin by UAE time 2130H on date 27th October, 2021 through the subject Moodle site. You have only one attempt to upload the document - no changes can be made. d. If you are unable to upload the answer booklet in Turnitin before the due time, DO NOT PANIC. Email it to the lecturer at HaroonKhan@uowdubai.ac.ae immediately within time limit as specified for the Turnitin upload. Resubmit via Turnitin later. e. Write your FULL NAME and STUDENT NUMBER in the HEADER of your answer document, so that it appears on all the pages of your answer sheet f. The professor will have the discretion to conduct viva on the submission made, if needed. THIS EXAMINATION CONTENT IS STRICTLY CONFIDENTIAL Questions In Reference to the case provided, and learning in the class, "Inflation Targeting in South Africa, please answer following questions: Question No 1 Assume that inflation is projected to surge in 2002. a) Under an IT regime, what kind of monetary policy must the SARB implement in its first policy meeting in 2002? b) What are the predicted effects on the economy (interest rates, real activity, the exchange rate, etc.)? Question No 2 Assume again that inflation is projected to surge in 2002. a) If South Africa were to discontinue its IT policy, what monetary policy measures would you recommend? b) With these alternative measures, what are the predicted effects on the economy interest rates, real activity, the exchange rate, etc.)? Question No 3 a) Would you buy a South African Bond in Jan 2001? b) Would you like to invest in South African Bond in Feb 2002? Question No 4 a) Is inflation targeting the right strategy in emerging markets? Please discuss in relation with Central Bank's role in this case. b) Now assume you are advising the South African government. What is your recommendation for monetary policy in early 2002? Family Name SUBJECT CODE FIN 958 First Name Subject Name: Financial Markets Autumn 2021 Midterm Examination Time Allowed: 2 Hours Student Total Number of Questions: 4 Number.... Total Number of Pages (incl. this page): 2 1. Answer all questions. Each question carries equal 25 marks. 2. Answers must be written and drawn) in word document and Table Number the word limit is 5000 words. Your answers should be clear and concise. Include all relevant information, but only relevant information. 3. Total marks: 100. This Exam is worth 30% of your final marks for FIN958. INSTRUCTIONS TO STUDENTS (FURTHER TO INSTRUCTIONS POSTED ON MOODLE SITE). Download the provided Answer Booklet and start typing your answers in the Answer Booklet (word document). Keep saving your work on your desktop regularly. a. a. b. If your answer requires a diagram or calculation that cannot be created in the word document, use A4 size paper(s) to capture the diagram or calculation. Take a photo or scan of the paper (s), upload to your computer and attach with the Answer Booklet word document in order to form one single file that has to be uploaded. C. Upload the answer booklet as one file in Turnitin by UAE time 2130H on date 27th October, 2021 through the subject Moodle site. You have only one attempt to upload the document - no changes can be made. d. If you are unable to upload the answer booklet in Turnitin before the due time, DO NOT PANIC. Email it to the lecturer at HaroonKhan@uowdubai.ac.ae immediately within time limit as specified for the Turnitin upload. Resubmit via Turnitin later. e. Write your FULL NAME and STUDENT NUMBER in the HEADER of your answer document, so that it appears on all the pages of your answer sheet f. The professor will have the discretion to conduct viva on the submission made, if needed. THIS EXAMINATION CONTENT IS STRICTLY CONFIDENTIAL Questions In Reference to the case provided, and learning in the class, "Inflation Targeting in South Africa, please answer following questions: Question No 1 Assume that inflation is projected to surge in 2002. a) Under an IT regime, what kind of monetary policy must the SARB implement in its first policy meeting in 2002? b) What are the predicted effects on the economy (interest rates, real activity, the exchange rate, etc.)? Question No 2 Assume again that inflation is projected to surge in 2002. a) If South Africa were to discontinue its IT policy, what monetary policy measures would you recommend? b) With these alternative measures, what are the predicted effects on the economy interest rates, real activity, the exchange rate, etc.)? Question No 3 a) Would you buy a South African Bond in Jan 2001? b) Would you like to invest in South African Bond in Feb 2002? Question No 4 a) Is inflation targeting the right strategy in emerging markets? Please discuss in relation with Central Bank's role in this case. b) Now assume you are advising the South African government. What is your recommendation for monetary policy in early 2002