BM/OCT 2010/FIN536/MGT600
UNIVERSITI TEKNOLOGI MARA FINAL EXAMINATION
COURSE COURSE CODE EXAMINATION TIME
FINANCIAL MARKET AND INSTITUTIONS FIN536/MGT600 OCTOBER 2010 3 HOURS
INSTRUCTIONS TO CANDIDATES 1. 2. 3. This question paper consists of seven (7) questions. Answer five (5) questions only in the Answer Booklet. Start each answer on a new page. Do not bring any material into the examination room unless permission is given by the invigilator. Please check to make sure that this examination pack consists of: i) ii) the Question Paper an Answer Booklet - provided by the Faculty
DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO
This examination paper consists of 4 printed pages
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2
BM/OCT 2010/FIN536/MGT600
QUESTION 1 a) 'Wholesale banking' is associated with the role played by investment banks. Explain the functions, contributions, and sources and uses of funds of an investment bank as one of the financial intermediaries in a financial system. (7 marks) Give two (2) benefits of financial intermediation. (3 marks) c) (i) Explain brieifly two (2) shariah concept applied in Islamic banking transactions. (5 marks) Bank Negara Malaysia is stepping up efforts in making this country a hub for Islamic banking and finance. In your opinion what kind of support is needed to make this country a hub for Islamic banking? (5 marks)
b)
(ii)
QUESTION 2 a) i) What is an interest rate? What is the intention of BNM if they announced the reduction of overnight policy rate (OPR)? (5 marks) Explain the effect of time to maturity and default risk on interest rates. (5 marks) b) Explain the objective of Bank Negara Malaysia in 'keeping reserves to safeguard the value of the currency'. (6 marks) How is Open Market Operations used by Bank Negara Malaysia as one of the monetary tools? (4 marks)
ii)
c)
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