...AGF INVES TMENTS INVES TOR SERIES Helping you make sense of your investments The Inflation Effect: How will it impact you? Inflation is, in a nutshell, the rate at which the price for goods and services, and therefore the cost of living, rises. A chief measure of price inflation is the inflation rate, which is the annualized percentage change in a general price index (normally the Consumer Price Index) over time. Although inflation has been benign over the past several years, it can rise quite dramatically, as the chart below illustrates. For example, in 1981, inflation rose 12% from the previous year. 14% 12% 10% 8% 6% 4% 2% 0% 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Inflation can affect many aspects of our lives, from the cost of food to how much we need to spend on a new car or a new house. Though you may not notice over the short term, inflation can have a substantial negative effect on the value of your purchasing power and of your investment portfolio over the long term. Investors need to be aware of the risks and know what steps they can take to protect their portfolios from inflationary pressures. Source: Statistics Canada, December 31, 2013 AGF INVES TMENTS Inflation is beginning to rise in emerging markets...
Words: 940 - Pages: 4
...all questions on your objective test answer sheet. Use a black ball-point pen. Do not use pencil. Do all rough work in this question paper, not on your objective test answer sheet. Section B (ECON2/2) Answer EITHER Context 1 OR Context 2. Use black ink or black ball-point pen. Pencil should only be used for drawing. Write the information required on the front of your answer book. The Paper Reference is ECON2/2. Information The maximum mark for this paper is 75. There are 25 marks for Section A. Each question carries one mark. No deductions will be made for wrong answers. There are 50 marks for Section B. The marks for questions are shown in brackets. You will be marked on your ability to: – use good English – organise information clearly – use specialist vocabulary where appropriate. Advice You are advised to spend no more than 25 minutes on Section A and at least 50 minutes on Section B. G/TI/100665/Jun14/E3 ECON2 2 Section A: Objective Test Answer all questions in Section A. Each question carries 1 mark. No deductions will be made for wrong answers. You are advised to spend no more than 25 minutes on Section A. For each question there are four alternative responses, A, B, C and D. When you have selected the response which you think is the best answer to a question, mark this response on your objective test answer sheet. If you wish to change your answer to a question, follow the instructions on your objective test...
Words: 3509 - Pages: 15
...Stocks Stocks are a form of ownership; they represent interest in a company's development. Typically, investors are given no guarantees about returns of the beginning venture. Truth be told, the productivity of the venture depends completely after rising stock cost, which, at the most key level, relates specifically to the execution and development (expanding benefits) of the company. Advantages of Investing in Stocks Stocks offer gainful returns back with constrained losses. When you put resources into stocks, you have the capability of profiting than you would with different types of investments, for example, fixed rate bonds and certificate of deposits, on the grounds that stocks participates specifically in the development of the economy and as time goes on have truly beat whatever other type of investment. However, any potential losses are constrained to the measure of your starting venture, not at all like different manifestations of investment that are utilized, for example, land where you could owe more than your original up front installment. In this respect, shareholders have constrained risk for the activities of the organization's administration in light of the fact that shareholders are detached investors that just participates in the capital gains and profits of the organization. Stocks additionally offer a lot of liquidity on the grounds that they can be sold at their market value and changed over to money whenever on the stock trade. Ultimately, stocks...
Words: 1509 - Pages: 7
...questions on your objective test answer sheet. Use a black ball-point pen. Do not use pencil. Do all rough work in this question paper, not on your objective test answer sheet. Section B (ECON2/2) Answer EITHER Context 1 OR Context 2. Use black ink or black ball-point pen. Pencil should only be used for drawing. Write the information required on the front of your answer book. The Examining Body for this paper is AQA. The Paper Reference is ECON2/2. Information The maximum mark for this paper is 75. There are 25 marks for Section A. Each question carries one mark. No deductions will be made for wrong answers. There are 50 marks for Section B. The marks for questions are shown in brackets. You will be marked on your ability to: – use good English – organise information clearly – use specialist vocabulary where appropriate. Advice You are advised to spend no more than 25 minutes on Section A and at least 50 minutes on Section B. G/T90774/Jun13/ECON2 6/6/6/ ECON2 2 Section A: Objective Test Answer all questions in Section A. Each question carries 1 mark. No deductions will be made for wrong answers. You are advised to spend no more than 25 minutes on Section A. For each question there are four alternative responses, A, B, C and D. When you have selected the response which you think is the best answer to a question, mark this response on your objective test answer sheet. If you wish to change your answer to a question, follow the instructions on your objective...
Words: 3587 - Pages: 15
...report of your analysis and responses to all questions 5. Where appropriate, present key Finance and Economic theories to support your answers together with any assumptions you choose to use in your analysis and any practical implications that these may have. Submission Requirements 6. You need to submit an electronic copy (Word Document) of your work via the VLE during the submission period. 7. You need to submit an Excel spreadsheet with ALL the calculations made via the VLE during the submission period. 8. Your work should be uploaded into the VLE via a dedicated submission link to be provided. 9. Do not send your completed work via email. Under no circumstances will the work be accepted when emailed to any member of the faculty. 10. Note that there are penalties for late submission. Any work submitted after the designated deadline will not be marked. Referencing 11. You need to follow a proper referencing system in your paper. 12. You also need to do a full bibliography of your sources. Number of words 13. There is no restriction on the number of words for this assessment but there is also no need to answer questions that are not asked. It is equally not necessary to present any arguments that are not relevant to the specific questions on which you are being assessed. Pass mark This assessment constitutes 100% of the overall mark for the module. The pass mark for this assessment is 40%. If this is not your first attempt...
Words: 1129 - Pages: 5
...Bonds * Strategies * Bonds at Your Stage of Life * About Municipal Bonds * About Government/Agency Bonds * About Corporate Bonds * About MBS/ABS * How to Use This Site * Links to Other Sites Learn More * Overview * Bond Basics * What You Should Know * Overview * The Role of Bonds in America * Investor's Checklist * Investor Protection * Asset Allocation * Reading Bond Prices In the Newspaper * Understanding Economic Statistics * Bond and Bond Funds * Risks of Investing in Bonds * Rating Changes and Your Investments * Corporate Bankruptcy & Your Investment * Selecting and Working with a Financial Professional * Rising Rates and Your Investments * Tax Tables * Buying and Selling Bonds * Types of Bonds * Strategies * Bonds at Your Stage of Life * About Municipal Bonds * About Government/Agency Bonds * About Corporate Bonds * About MBS/ABS * How to Use This Site * Links to Other Sites What You Should Know * Print * Email Risks of Investing in Bonds All investments offer a balance between risk and potential return. The risk is the chance that you will lose some or all the money you invest. The return is the money you stand to make on the investment. The balance between risk and return varies by the type of investment, the entity that issues it, the state of the...
Words: 2099 - Pages: 9
...Report ¹ SUBMITTED TO PROF. NEIL COHEN School of Business and Public Management The George Washington University BY Anil Kumar Cheerla FINA 6224 FINANCIAL MANAGEMENT WASHINGTON, DC January 26, 2011 Q1: Consider which comparable peers are good matches and use them to perform a multiples analysis, calculating and defending an estimate of Crocs value. Soln: Comparable companies analysis – Done to determine appropriate valuation multiple for Crocs, Inc. • • Selected peer group based on industry, business and financial characteristics Included explosive growth stocks such as Lulelemon & Under Armour having similar prospects for growth and ROIC as Crocs, Inc. and some mature, stabilized businesses with stable industry growth rates – Nike, Deckers & Timberland. This mix will help us provide valuation from an aggressive sales growth and maturing sales context. Some characteristics used in selection include – o Primary or at least significant portion of business revenue comes from footwear & apparel – analogous to Crocs primary business o Has product appeal to large group of customers o Has distinct product attributes (innovative/creative) and differentiation from competition o Has wide range of distribution channels o CAGR Sales growth, COGS to Sales & Significantly less debt exposure on their balance sheets o Have characteristics of high octane growth and show signs of maturity and stabilizing long-term growth similar to well established footwear brands. • Valuation...
Words: 2072 - Pages: 9
...Trends and Poverty in Bangladesh CONTENTS ABBREVIATIONS .................................................................................................................ii EXECUTIVE SUMMARY ....................................................................................................iii I. INTRODUCTION ....................................................................................................................1 II.INFLATION A. What is Inflation B .How is it measured C. Inflation and Interest rates D. Inflation and Investments Types of Inflation II. TREND OF MACROECONOMIC PERFORMANCE AND POVERTY REDUCTION INITIATIVES IN BANGLADESH ......................................................2 A. Growth Performance ...............................................................................................2 B. Savings and Investment ..........................................................................................2 C. Inflation ...................................................................................................................3 D. Fiscal Sector Developments ....................................................................................3 E. Macroeconomic Challenges of Bangladesh ............................................................4 F. Medium-term Macroeconomic Framework.............................................................5 G. Reform Initiatives...
Words: 4096 - Pages: 17
...[pic] |CLOSED BOOK EXAMINATION | MODULE: FINANCE Student’s Name: ___________________________________ID No._________ E-mail: _________________________________Cell phone: _____________ Signature: _________________________________ MARKING TABLE |SECTION |QUESTION |Max score |MARKING |NOTE | | | | |1st |2nd |Final | | |A |ONE |Part (a) |25 | | | | | |(80 Marks) |(35 Marks) | | | | | | | | | |Part (b) |10 | | | | | | |TWO |Part (a) |35 | | | | | | |(45 Marks) | | | | | | | | | |Part (b) |10 | | | | ...
Words: 916 - Pages: 4
...essence in helping maximum elaboration of the measures. Coupon: The interest payment sent to the owner of an individual bond, usually twice a year. The coupon rate is the interest rate the issuer promises to pay to the investor. For fixed-income investments, this rate is fixed at the time a bond is issued and doesn't change. Market interest rates: The prevailing interest rates in the bond markets on any particular day. These rates change based on the economy, policies and other factors. There is no single market interest rate. The rates will vary based on the time to maturity for a particular bond, the credit quality of the issuer and other factors. Market price: The current value of an existing bond if you wanted to sell. This is the price you'd see on your quarterly statements. Market prices can be above (or at a premium to) the par value, or below (at a discount to) the par value, depending on current market interest rates, the promised coupon rate and other conditions. Maturity: The date that a bond's par (face) value is repaid and interest payments stop. The longer the time to maturity, generally, the higher the interest rate will be—but the higher the risk of a bond's price falling, as well, if market interest rates increase. As time passes and the maturity date approaches, the impact of interest rates declines. The price of a bond, if trading at a discount or premium, will move back toward par the closer the maturity date. Par: Also known as "face value,"...
Words: 1958 - Pages: 8
...future are more uncertain than in the short term. In either case, investors generally demand higher interest rates to offset the increased risk these bonds carry. In general, when interest rates rise, bond prices fall. When interest rates fall, bond prices rise. Example – You own a bond paying 3% interest. When interest rates are low – say 1% – your interest rate is higher than the going rate. This makes your bond attractive to other investors. But if interest rates rise to 5%, your bond is less attractive. When inflation is on the rise, bond prices fall. When inflation is decreasing, bond prices rise. That’s because rising inflation erodes the purchasing power of what you’ll earn on your investment. In other words, when your bond matures, the return you’ve earned on your investment will be worth less in today’s dollars. Credit rating agencies assign credit ratings to bond issuers and to specific bonds. A credit rating can provide information about an issuer’s ability to make interest payments and repay the principal on a bond. In general, the higher the credit rating, the more likely an issuer is to meet its payment obligations – at least in the opinion of the rating agency. If the issuer’s credit rating goes up, the price of its bonds will rise. If the rating goes down, it will drive their bond prices lower. Small business .chron.com/factors-affect-interest-rate-corporate-bonds-1821.html Finance - Marine Millon Cornet, Troy A. Adair Jr. John...
Words: 307 - Pages: 2
...Ma Running Head: Aggregate Demand and Supply Models Aggregate Demand and Supply Models ECO-372 The current state of the current US economy is in a spiral deficit that can be attributed to several factors. Of these many aspects there are a handful that stands out such as gas prices, interest rates and most importantly unemployment. The unemployment rate in the United States has decreased to 7.8 percent in September of 2012. Historically, from 1948 until 2012, the United States Unemployment Rate averaged 5.80 Percent reaching an all-time high of 10.80 Percent in November of 1982 and a record low of 2.50 Percent in May of 1953 (Trade Eco, 2012). Unemployment As of 2012 the rate of unemployment has dropped dramatically throughout 41 states with some states not even seeing a change of improvement such as California being in the top 5 of the highest unemployment rate. Long-term unemployment has serious ramifications for the individual and for the economy. Individuals suffering long term unemployment become less motivated and begin to lose their credibility and experience as well as the ability to compete in the job market, and become less employable as time goes by. It is not a sense of thinking that things will “get better” and a job will arise, because when it does the length of time a citizen has been unemployed does come into effect. Unemployment Cont.: Unemployment...
Words: 1305 - Pages: 6
...UNIVERSITY OF TORONTO Faculty of Arts and Science & Rotman School of Management Final Examination, April, 2010 RSM 230H1S – Financial Markets INSTRUCTIONS: You have 2 hours for this exam. Complete your Scantron in PENCIL and use it to answer Part A of the exam. Answer Part B of the exam on this paper in the space provided. All cell phones and portable electronic devices must be turned off. Non-programmable calculators are permitted Please remain in your seats during the last 15 minutes of the exam period so you do not disturb others. PLEASE SUPPLY THE FOLLOWING INFORMATION: Student #__________________ Student Name___________________ Circle your Instructor’s Name: Huggins Stapleton Indicate your Section: Monday 8:00 –10:00 ____ Wednesday 8:00-10:00 _____ Monday 10:00 –12:00 ____ Wednesday 10:00-12:00 _____ Thursday 11 am to 1 pm _____ Please check that you have filled in your Scantron sheet correctly: 1) Write in and bubble your student ID number (one entry per column) as well as your Last Name and Initials. Hyphenated last names should be bubbled in without spaces or dashes. 2) Do not make any marks outside the shaded area PART A – Multiple choice questions. (75% of total grade) Please answer in pencil on the Scantron provided. All questions have equal weight. There is...
Words: 2287 - Pages: 10
...com/university/inflation/ Thanks very much for downloading the printable version of this tutorial. As always, we welcome any feedback or suggestions. http://www.investopedia.com/contact.aspx Table of Contents 1) Inflation: Introduction 2) Inflation: What Is Inflation? 3) Inflation: How Is It Measure? 4) Inflation: Inflation And Interest Rates 5) Inflation: Inflation And Investments 6) Inflation: Conclusion Introduction During World War II, you could buy a loaf of bread for $0.15, a new car for less than $1,000 and an average house for around $5,000. In the twenty-first century, bread, cars, houses and just about everything else cost more. A lot more. Clearly, we've experienced a significant amount of inflation over the last 60 years. When inflation surged to double-digit levels in the mid- to late-1970s, Americans declared it public enemy No.1. Since then, public anxiety has abated along with inflation, but people remain fearful of inflation, even at the minimal levels we've seen over the past few years. Although it's common knowledge that prices go up over time, the general population doesn't understand the forces behind inflation. What causes inflation? How does it affect your standard of living? This tutorial will shed some light on these questions and consider other aspects of inflation. (Page 1 of 7) Copyright © 2010, Investopedia.com - All rights reserved. Investopedia.com – the resource for investing and personal finance education. What Is Inflation? Inflation is defined as...
Words: 2407 - Pages: 10
...UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS General Certificate of Education Advanced Level ECONOMICS Paper 3 Multiple Choice (Supplement) 9708/32 October/November 2013 1 hour Additional Materials: Multiple Choice Answer Sheet Soft clean eraser Soft pencil (type B or HB is recommended) *9990546754* READ THESE INSTRUCTIONS FIRST Write in soft pencil. Do not use staples, paper clips, highlighters, glue or correction fluid. Write your name, Centre number and candidate number on the Answer Sheet in the spaces provided unless this has been done for you. DO NOT WRITE IN ANY BARCODES. There are thirty questions on this paper. Answer all questions. For each question there are four possible answers A, B, C and D. Choose the one you consider correct and record your choice in soft pencil on the separate Answer Sheet. Read the instructions on the Answer Sheet very carefully. Each correct answer will score one mark. A mark will not be deducted for a wrong answer. Any rough working should be done in this booklet. This document consists of 13 printed pages and 3 blank pages. IB13 11_9708_32/3RP © UCLES 2013 [Turn over 2 1 What is the purpose of trying to achieve economic efficiency? A B C D 2 to ensure that economic decisions are made equitably to ensure that firms are internationally competitive to ensure that firms maximise their profit levels to ensure that the economy does not waste scarce resources The table shows the total utility that an individual...
Words: 2278 - Pages: 10
