Question
FMI test 1 question paper has been completed and will be given to you on Monday, 17th March, i.e. Monday of week 6, during regular lecture time so you have exactly two weeks to prepare for it. Test tips are provided below:
FMI Test 1 Tips
Test 1 covers topics 1.1, 1.2 & 1.3 (Textbook chapters 1, 2, & 3)
There are only 2 parts to the test:
Part 1: 25 Multiple Choice questions (worth 1 mark each) totalling 25 marks
8 questions from topics 1.1, 9 questions from topic 1.2, and 8 questions from topic 1.3
Part 2: 3 x short answer/Essay questions (worth various marks) totalling 15 marks
Q1: from Topic 1.1:
1) Why is the existence of well-developed secondary markets important to the functioning of the primary markets within the financial system? (4 marks)
Q 2: from topic 1.2:
2) The off-balance-sheet business of commercial banks has expanded significantly and, in notional value terms, now represents over five times the value of balance-sheet assets.
(a) Define what is meant by the off-balance-sheet business of commercial banks, and,
(b) Identify the four main categories of off-balance-sheet business and use an example to explain each category. (6 marks)
Q3: from topic 1.3:
Advising corporate clients on mergers and acquisitions (M&A)—in which one company gains control over another—is a significant fee-generating service provided by investment banks. In the context of M&A, explain the differences between horizontal takeover, vertical takeover, and conglomerate takeover. (5 marks)
Note
1. Answers to the short essay questions should be no less than half a page and no more than one page.
2. I am not assigning any specific tutorial questions for test 1 because specific tutorial questions are normally assigned for problems/calculations type of questions and there are no problems/calculations questions in Test 1. Problems/calculations questions will definitely appear in test 2, (i.e. mid semester exam) and the final exam.
Explain what does point number one in the note mean?
FMI Test 1 Tips
Test 1 covers topics 1.1, 1.2 & 1.3 (Textbook chapters 1, 2, & 3)
There are only 2 parts to the test:
Part 1: 25 Multiple Choice questions (worth 1 mark each) totalling 25 marks
8 questions from topics 1.1, 9 questions from topic 1.2, and 8 questions from topic 1.3
Part 2: 3 x short answer/Essay questions (worth various marks) totalling 15 marks
Q1: from Topic 1.1:
1) Why is the existence of well-developed secondary markets important to the functioning of the primary markets within the financial system? (4 marks)
Q 2: from topic 1.2:
2) The off-balance-sheet business of commercial banks has expanded significantly and, in notional value terms, now represents over five times the value of balance-sheet assets.
(a) Define what is meant by the off-balance-sheet business of commercial banks, and,
(b) Identify the four main categories of off-balance-sheet business and use an example to explain each category. (6 marks)
Q3: from topic 1.3:
Advising corporate clients on mergers and acquisitions (M&A)—in which one company gains control over another—is a significant fee-generating service provided by investment banks. In the context of M&A, explain the differences between horizontal takeover, vertical takeover, and conglomerate takeover. (5 marks)
Note
1. Answers to the short essay questions should be no less than half a page and no more than one page.
2. I am not assigning any specific tutorial questions for test 1 because specific tutorial questions are normally assigned for problems/calculations type of questions and there are no problems/calculations questions in Test 1. Problems/calculations questions will definitely appear in test 2, (i.e. mid semester exam) and the final exam.
Explain what does point number one in the note mean?
Answers
GPT-4o mini
Point number one in the note emphasizes the expected length and detail of the answers for the short essay questions in the FMI Test 1. Specifically, it states that each answer should be:
1. **No less than half a page**: This means that you should provide sufficient detail and information in your response to ensure you cover the topic thoroughly. A response that is shorter than half a page might be seen as lacking depth and may not fully address the question or provide enough explanation.
2. **No more than one page**: This indicates that while you should be detailed in your responses, you also need to be concise. Answers that exceed one page might include unnecessary information or go off-topic, which could detract from the clarity and focus of your response.
Overall, this guideline aims to help you find a balance between providing comprehensive answers and being concise, ensuring that you can effectively communicate your understanding of the topics without overwhelming the reader with extraneous information.
1. **No less than half a page**: This means that you should provide sufficient detail and information in your response to ensure you cover the topic thoroughly. A response that is shorter than half a page might be seen as lacking depth and may not fully address the question or provide enough explanation.
2. **No more than one page**: This indicates that while you should be detailed in your responses, you also need to be concise. Answers that exceed one page might include unnecessary information or go off-topic, which could detract from the clarity and focus of your response.
Overall, this guideline aims to help you find a balance between providing comprehensive answers and being concise, ensuring that you can effectively communicate your understanding of the topics without overwhelming the reader with extraneous information.