Essay

1.Exchange Trade (ETF) are define by marketable security that tracks the index like commodities and bonds are like index funds arecommon stock on the exchange, and watching the currency of mobility daily to the stock on the exchange. The (ETF) is a type of fundthat owns basket assets of oil, stock, bonds, foreign currency, and gold bars which the assets are divide into shares into an actualinvestment vehicle structure. Trading involves the transfer of ownership of good or service to one party to another for money.Example:When a company or institution wants to invest into the economic market, there is always a third party host that does the investing forthe company on the stock market by exchanging trade by economic value on the market to other parties for a greater amount, than thepresent rate on the market daily to find a profitable rate for the investors by buying or selling stocks.Retrieved from, https://en.wikipedia.org/wiki/Exchange-traded_fund2.Exchange-traded marketThe exchange-traded market is a standardized financial market that is traded on an organized exchange. Opposite to OTC, exchange-tradedproducts are standardized and clearinghouse guarantees all sides of any transaction perform its obligations. Exchanges are more thanphysical locations; they set the institutional rules that govern trading and information flows about that trading. (Dodd 2012) Unlikethe OTC market, all involvement is formal. A few standardized relationships are pricing, maturity, quantity, frequency, quality, anddocumentation.ReferencesCampbell R. Harvey. (2012) Over-the-counter (OTC) Retrieved February 4, 2016, fromhttp://www.nasdaq.com/investing/glossary/o/o.t.c.#ixzz3zEkbLbYC3.Central BankThe functionalities are:1. To issue bank notes and coins.2. To regulate the amount of money in circulation.3. To maintain and Invest currency reserve4. To act as a lender of the last resort.How does the market intervene in the market by?1. The bank can intervene as a last resort lender and as a regulatory of currency exchange rate to the current market in maintainorderly trading conditions.2. The bank can intervene when there is a decline within currencies like the Euro’s.Retrieved from, http://www.economicshelp.org4.Explain the role of central banks and discuss how central banks intervene in the market.Central banks primary functions are to Implement a monetary policy that provides consistent growth and employment, Promote thestability of the country’s financial system, Manage the production and distribution of the nation’s currency, and Inform the public ofthe overall state of the economy by publishing economic statistics. (Investopedia 2016) Central banks also function as the bank of thegovernment, regulate the credit system, oversee commercial banks, manage exchange reserves and act as a lender of last resort.Central banks, especially those in developing countries, intervene in the foreign exchange market to build reserves, stabilize theexchange rate and to correct misalignment. Recently Poland’s central bank left its reference rate steady at 1.50 percent, as expected,saying inflation will remain negative in coming months due to “depressed prices of global energy commodities” but the central bankinvolvement was to stable economic growth amid improving economic activity in the euro area and favorable labor market conditions.(Central Bank News 2016)Open and review the ICC Programme of Action and list at least two items that ICC has achieved for business.ICC intervened successfully in the G20 process in 2013, helping to produce a declaration by the group of 20 economic powers who met inSt Petersburg, Russia.ICC launched the ground breaking Jerusalem Arbitration Centre in 2013 to resolve commercial disputes between Israelis and Palestinians.(ICC 2014)ReferencesCentral Bank News, (February 3, 2016), Retrieved February 4, 2016, from http://www.centralbanknews.info/2016/02/poland-maintains-rate-sees-rising-core.html#more