In your own words, explain via the use of examples, the following commercial bank risks as well as their impact on commercial banking activities:

i. Reputational risk

ii. Country (i.e., Sovereign) risk

(400 words)

Ahmed and Mohammed want to start their own business. They are thinking to establish a factory to manufacture
sunglass in Oman. The factory needs an investment of OMR 600,000. Mohamed having OMR 150,000 and
Ahmed having OMR 250,000. They have a shortage of OMR 200,000. Ahmed suggests to take loan from Bank
but Mohammed suggests to sell shares to manage the investment shortage. They are confusing regarding the suitable source of finance to manage the investment shortage. This will affect the legal entity of their
organization. There are many forms of organization, but they are confusing between LLC and SAOG.

Furthermore, Ahmed suggest to hire the following employees:
 The Managing Director has the major responsibility for running of the company, including setting
company targets and keeping an eye on all departments.  The Distribution Manager is responsible for controlling the movement of goods in and out of the
warehouse, supervising drivers and overseeing the transport of goods to and from the firm.  The Production Manager is responsible for keeping a continuous supply of work flowing to all production
staff and also for organizing manpower to meet the customers' orders.  The Sales Manager is responsible for making contact with customers and obtaining orders from those
contacts.  The Finance Manager controls all the financial dealings of the company and is responsible for producing
management accounts and financial reports.  The Public Relation Manager is responsible for external communications, media, social media and
complains  The Human Resource Manager is responsible to handle all staff affairs, HRP, recruitment and selection,
etc.  The IT Manager is responsible for maintain the organization ERP and any technology within the
organization  Maintenance manager is responsible to maintain the production line and company assets.   
Also, they are planning to hire 5 distribution officers, 5 accountants, 5 HR officers, 3 Public relation officers, 10 Trade promotors, 5 Mechanical Engineering for production, 5 Mechanical Engineering for maintenance 100 production labours and 10 Labour supervisors.

Explain the main functional areas of a business organization that you have identified from the case study? Support your answer by identifying the responsible manager of each functions

1. In your own words, explain the entire process of the transmission mechanism in an expansionary monetary policy. (300-400 words)

2. In your own words explain what is meant by the following statement: ‘Commercial banks are continually faced with the dilemma between profitability and safety’. (250-300 words)

Suppose that a food processing plant and a chemical factory are located close to each other on the banks of a river. The chemical factory uses the river to discharge its emissions. The food processing plant (located somewhere downstream) suffers damages from the emissions as it requires clean water for its operations. Assuming MAC = 240-2E and MD = 3E, answer the following questions. Draw this diagram before answering the questions below. You will be asked to upload the diagram at the end of this assignment.

(iv) If the chemical factory has the right to use the river ( or has the property right), what is the net gain to the food processing plant in the bargaining equilibrium ( i.e from bargaining compared to the situation where they do not bargain)? Remember net gain/benefit means total benefits - total costs.

Explain moral hazard and give at least two examples. Discuss its implications as an informational asymmetry problem for financial crises.

Explain why quantitative easing to stabilize the US economy was considered a moral hazard (i.e., why will QE paid in 2008 will cause future banks to behave badly).

Explain the so-called impossible trinity (also known as open economy trilemma). Using the diagram, discuss the policy alternatives of the monetary authority under different scenarios.

Select TWO companies from the same industry. Select a country (other than the companies’ home country) that is a market for the companies. Discuss the demographic, cultural and economic characteristics, including how the local demographics and economics affect the value proposition of the product or service offered by the companies. What is each company’s value proposition? Include how each company adjusted its value proposition for the selected country. Research the demographic and cultural characteristics of the middle class in the country or countries you are evaluating?

Explain moral hazard and give at least two examples. Discuss its implications as an informational asymmetry problem for financial crises.

Explain the so-called impossible trinity (also known as open economy trilemma). Using the diagram, discuss the policy alternatives of the monetary authority under different scenarios.

Explain the financial account of the balance of payments. Discuss the benefits and harms of financial globalization taking also into account different types of financial flows and their implications.

Explain moral hazard and give at least two examples. Discuss its implications as an informational asymmetry problem for financial crises

Discuss the increase in income inequality observed in the U.S. over the last 40 years from the perspective of the Heckscher-Ohlin Model. Analyze the potential causes of this increase and provide graphical illustrations if applicable.