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QUESTION THREE a) Bone Ben Ltd is investing 10.0 million for 120 days in certificate of deposit (CD) with a stated rate of 10
QUESTION THREE a) Bone Ben Ltd is investing 10.0 million for 120 days in certificate of deposit (CD) with a stated rate of 10 percent as part of portfolio of short term surplus funds that may be required to finance an acquisition at anytime. If after 45 days market rate rise to 12 percent what will be the market value of the CD? b) Briefly distinguish between fiscal policy and monetary policy. 6 marks 4 marks c) How does the Central bank control the money supply in an economy? What are the three main tools used and how do they work? 10 marks
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