Assignment: MARKET EFFICIENCY
Instructions
1. There are the four primary factors impacting asset demand which in turn changes the interest rate. They are: wealth, expected returns, risk and liquidity. In this discussion, we will analyze the impact on interest rates. We will also discuss the various factors in today's market, some of which are listed below.
How will the factors below (a, b,c and d) impact asset demand and ultimately interest rate?
a. The average income in the United States will continue to grow at a rate of 5% annually.
b. Prices in the stock market are becoming more volatile.
c. The business forecast for the next quarter is projecting a downturn.
d. The Federal Reserve Bank decreases the money supply by selling more bonds to the public.
e. Discuss one new scenario which can change the interest rate.
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.