2023 1 Discuss why financial markets are important to a healthy economy and how they contribute to | Assignments Online

1. Discuss why financial markets are important to a healthy economy and how they 

 

contribute to economic growth.

 

2. Assume that you recently graduated with a degree in finance and have just 

 

reported to work as an investment adviser at the brokerage firm of Smyth Barry 

 

& Co. Your first assignment is to explain the nature of the U.S. financial markets 

 

to Michelle Varga, a professional tennis player who recently came to the United 

 

States from Mexico. Varga is a highly ranked tennis player who expects to invest 

 

substantial amounts of money through Smyth Barry. She is very bright; therefore, 

 

she would like to understand in general terms what will happen to her money. After 

 

your consultation with Michelle, she asks to discuss these two scenarios with you:

 

a. While in the waiting room of your office, she overheard an analyst on a financial 

 

TV network say that a particular medical research company just received FDA 

 

approval for one of its products. On the basis of this “hot” information, Michelle wants 

 

to buy many shares of that company’s stock. Assuming the stock market is highly 

 

efficient, what advice would you give her?

 

b. She has read a number of newspaper articles about a huge IPO being carried out 

 

by a leading technology company. She wants to get as many shares in the IPO as 

 

possible and would even be willing to buy the shares in the open market immediately 

 

after the issue. What advice do you have for her?

 

 

Need answer for all the question 100 words each for answer